An Investigation of This Supposedly Victorious Capitalism – Claude Bitot

Preface to the Spanish Edition

Viewed exclusively from the perspective of economics, can we say that capitalism has a historical limit? For her part, the great Marxist Rosa Luxemburg responded by saying that while capitalism, as a mode of production, will undoubtedly reach a final stage, in which it will become “an objective economic impossibility”, she nonetheless dismissed this eventuality by stating that even before capitalism runs the full course of its historical trajectory, “the exacerbation of social and political antagonisms” will lead to “such an unsustainable situation” that there will be no need for capitalism to reach such a stage for it to disappear. This is what she said in 1913 in her essay, The Accumulation of Capital. Now, almost 90 years later, can we still uphold such a point of view? History has since shown that the class struggle, which according to Rosa Luxemburg was supposed to abbreviate capitalism’s lifespan, has not been capable of fulfilling this mission. Not because this struggle was non-existent, but because capitalism found within itself sufficient economic resources that enabled it to pull the rug out from under the feet of the class struggle and thus to render it so inoffensive that capitalism could prevent it from posing any serious danger to it as a system. This is what happened, for example, during the great crisis of 1929-1933, when capitalism, despite the spectacular collapse of its economy, managed to salvage the situation and thus neutralize the class struggle as the latter was conceived from a revolutionary point of view, so that the class struggle only resulted in reformist solutions: New Deal, Keynesianism, state intervention, not even taking into account the stage known as the “30 glorious years” after the end of the war in 1945, which witnessed, with the aid of the “Welfare State”, the implementation of a whole series of reforms (social security, pensions, minimum wage legislation, paid vacations, etc.), which had the effect of further attenuating the class struggle.

Does this mean that the class struggle must be considered to be null and void during the final stage of capitalism? No, since it is clear that capitalism will not disappear on its own without human intervention. It is true that humans make their own history but, as Marx said, they do so under determinant conditions. However, as the history of the 20th century has demonstrated, it is clear that these conditions never arose. This means: as long as capitalism possesses an economic margin of maneuver to overcome its crisis and thus enable it to continue the process of accumulation, we will not be able to count on the class struggle to put an end to it. For this to happen it will be necessary for capitalism to have reached its objective economic limits and thus to have come to the end of its possible historical course and then it will be abolished by human action.

In order to discover a victorious solution that would lead to a non-falsified communism, through what kind of complex process will this human action have to proceed? This cannot be precisely discerned, since the struggle for the final liquidation of capitalism has not yet begun. However, what can be discerned at this point—and this is the objective of this “investigation” concerning contemporary capitalism—is that the capitalist system has now entered, not a serious and permanent economic crisis that would herald its imminent collapse—it would be ridiculous to claim this to be the case—but a boundary zone of its development that we shall call the “end of its historical cycle”: from now on—since 1975, more or less—the system has lost its economic dynamism and no longer functions except in slow-motion; socially, in order to recover something of its old vitality, it is condemned to gradually dismantle the reformist mechanisms that it created, which will not fail to have consequences for the “social peace” that it was capable of establishing; it is structurally exhausted, and must expend ever more labor in order to reproduce capitalist social relations (the massive increase in unproductive jobs—jobs that do not create surplus value—which violates the logic of the system, a growing sector of the population that has been expelled from the wage labor force and condemned to exclusion, precarious living conditions, off-the-books work, welfare and charity, and part-time work); politically, it is running out of heirs, as bourgeois democracy is being abandoned by a growing number of voters; ideologically, it no longer has any credible alternatives to offer, as classical bourgeois ideals are being exhausted, even if they are experiencing a slight revival by brandishing the bogey of the pseudo-threat of the “fascist danger”.

Obviously, this situation that is being created, which could last quite a long time, is not a very pleasant epoch for us to live in, since we are experiencing the decline of a world, the decline of the capitalist world that first saw the light of day some five centuries ago. In this world, because no credible and tangible alternative that can replace it has yet appeared on the horizon, many people, in order to escape, deliver themselves over to a kind of flight forward in all kinds of diversions, in the “festive”—there has never been so much “festivity” about everything and nothing—since they have to be distracted, for a lack of anything better. It does not matter, this world is still our world, the one we have to analyze, examine, and decipher, and this is the purpose of this work, which is imbued with the idea that it will ultimately be vindicated by an emancipatory revolution.

June 2002

Part 1

“But unless all theoretical reasoning should be entirely valueless, in so far as it allows for predictability it points to the demise not only of capitalistic prosperity but also to the end of capitalism itself.”

(Paul Mattick, Critique of Marcuse: One Dimensional Man in Class Society, Herder and Herder, New York, 1972, p. 101)

Introduction

Today, its apologists present capitalism as “the impassable and limitless horizon of humanity”. For them, “the market economy”, so they say, is the best of all possible systems. Defined as “the production of goods and services”, it is this system which, measured in terms of “growth”, allows, thanks to its competition and its private initiative, continuous progress with regard to the production of wealth, and of incessantly renewed use values that everyone can have access to in accordance with their merit.

This apologetic credo encounters an echo that is all the more overwhelming insofar as it is based on a very tangible reality: for capitalist society in the last instance presents itself as an immense showcase of commodities permanently displayed to the gaze of the masses. In other times, when there was less capacity for production, it was more difficult to make capitalism pass for a “consumer society”. The goods produced were limited, only the tiny minority of the bourgeoisie could have access to them. The people, for their part, could only tighten their belts, as their consumption was reduced to what was strictly necessary. With the enormous productive powers that are now set in motion, such an image of capitalism, which is to some degree obsolete, has evaporated. Mass production has provided confirmation of the idea that most people can have access to this wealth. As a result, the prevailing idea of capitalism has undergone a transformation. Instead of being synonymous with poverty, exploitation and misery, it has become synonymous with abundance and limitless consumption. Capitalism has therefore been rehabilitated.

For its apologists, we are experiencing the advent of “victorious capitalism”. They discover the proof for this victory not only in the material advances of capitalism (with the new technologies of production, information and communication), but also in its spiritual conquests: henceforth, few are those who would dare to radically challenge capitalism; they would only reap ridicule and sarcasm; by way of an amused patronizing attitude they would be made to see that they are only the last representatives of a permanently superannuated past; its apologists, as intellectuals, exist for the purpose of declaring that there is no credible alternative to capitalism, that communism has failed and can only lead to “totalitarianism”. From now on, since capitalism is the only system that can be conceived, all that remains, in the form of opponents, are a handful of vague social reformers who, under diverse labels, feel uncomfortable about certain “excesses” of capitalism, and denounce its “ultraliberal” features, but are very careful not to challenge it as a system, and just want to make it “more human” and “more moderate”.

Thus, everything is proceeding in the best possible way in the best of all capitalist worlds. Capitalism “has won” and its apologists derive from this fact the conclusion that it is programmed for eternity. “The crisis”? But what crisis of capitalism are you talking about? The entire world has lined up behind “the market economy”, previously underdeveloped regions have seen businesses sprout up like mushrooms and world trade has never been so prosperous. It is true that there has been a certain slowdown in the rate of growth since 1974, but it is nothing serious: these “twenty calamitous years” will be followed by “twenty marvelous years” (Le Monde, December 17, 1994). In short, the discourse of the apologists praising capitalism is inexhaustible and insuperable. The only weak spot that still exists, in some regions of the world, is the rise of religious fundamentalism and nationalism, or, in the West, the “fascist danger”, which seemingly poses a threat to “our democratic societies”. But all of these things are part of the game. However much we may feel like victors, the sense of having some alleged enemy never loses its appeal: this reinforces social cohesion and allows the flame to keep burning.

This is one way of looking at today’s capitalism. It is the view of its apologists who, as we have pointed out, do not lack arguments to support their point of view. Another, very different view is possible, however.

Capitalism, in fact, has no reasons to celebrate. The “high technology” that it is so proud of? It is instead its tomb; it is not machines, however sophisticated they may be, that make profits, but men, men who, in the crucial sector of profitable production, are being eliminated by these very machines. “The return to liberalism” that is so praised by the experts of economic science? It is instead a confession of failure, the failure of the Keynesian “neo-capitalism” that was the object of so much praise in the past and which, with its State-induced unproductive consumption for the purpose of maintaining “general demand”, ended up plunging capitalism into the bottomless pit of monetary inflation and the collapse of the rate of profit; in fact, this “return”, with the retreat of the State that it implies, signifies the return to cyclical crises, with a catastrophic “1929-style” crisis as the end-point of the process. “The full employment” that capitalism was supposed to have attained? For twenty years now we have witnessed the emergence of massive and constantly increasing unemployment, the increasing precariousness of those jobs that still exist, and the pure and simple exclusion of a mass of men and women from the workforce who are condemned to public assistance and private charity, many of whom find themselves in the street “without any stable living situation”. And the famous “consumer society”? Today, capitalism, in order to restore its rate of profit to some extent and to make its enterprises competitive on the world market, is obliged to reduce real wages; this is why it is making the workers of the entire world compete with each other for the purpose of finding the cheapest labor power possible, and thus condemns millions of people to unemployment, who can only survive thanks to subsidies that are subject to constant reductions; under these circumstances, how can we claim that “an ever increasing” consumption is possible if a growing mass of men and women are excluded from its enjoyment? Even the “left/right” divide is blurring; it is becoming ever less credible, and has reached the point where their programs are basically indistinguishable, with hardly any nuances, and identical effects: even more unemployment, more people working part-time and temporary jobs, more people excluded from the wage labor force, more poverty, lower wages.

What conclusions should we draw from this capitalist reality? Is this a crisis? A crisis has the very precise economic characteristic of corresponding to a momentary slowdown of growth. Since 1974, however, the date that marked the end of the “thirty glorious years”, the economic expansion that followed pursued its forward march (even if it did so with weaker rates of growth) and has only been interrupted by recessions that were all overcome. As a result, we must admit that, at least if we interpret the word crisis in its strictest sense, what has been happening to capitalism for the last twenty years or so is something very different.

Frankly, it is at the end of a cycle. By this term we do not mean that it will collapse at any moment. This kind of prediction is too prone to the vagaries of chance to avoid attracting the scorn of those who believe capitalism is eternal, or, which amounts to more or less the same thing, those who think that it still has “glorious days ahead of it”. This term means that capitalism has now entered into a border zone, which could still last for quite a while, but which will have the effect of making the accumulation of capital, which is the defining characteristic of capitalism, more and more difficult, and finally impossible, and which will provoke its final collapse. The fall of the rate of profit, which up until now has been a mere tendency, will henceforth begin to be expressed in a form that will approach an absolute fall, and no longer a merely relative, but absolute decline of the surplus-value producing working class, the massive expansion of unproductive service-sector jobs, the rise of a form of unemployment that results in the definitive exclusion from the circuit of surplus value production of part of the active population; these are so many other indices of this end of capitalism’s cycle.

In fact, this other view that we have of capitalism has some points in common with that of its apologists. The latter are in effect capable of thinking that capitalism is victorious, because, having overcome all the obstacles in its path, it has attained such a degree of power that it has reached the point where it no longer, so to speak, has any enemies, but on the other hand this moment of its greatest triumph is also revealed as the beginning of its end, and indicates at the same time both its success and its objective limit, a limit that can now be glimpsed.

Obviously, its apologists can object that our point of view is false, since it is based on a kind of mistaken analysis, the Marxist analysis: the labor theory of value, the theory of surplus value, the distinction between productive and unproductive labor, and the law of the falling rate of profit. For our part, we think that only Marx’s analysis allows us to understand anything about capitalism, not only to know how it works, but also to know why it will ultimately collapse. The apologists’ point of view which tends to assume that capitalism is “unsurpassable”, or to put it another way, that it cannot die, is an aspect of the vulgar and super-vulgar economics that Marx had already denounced in his time. Once capitalism, he explained, had begun after 1825 to undergo its periodic crisis cycles, and the class struggle between the bourgeoisie and the proletariat began to assume explicit and threatening forms, “[i]t sounded the knell of scientific bourgeois economy. It was thenceforth no longer a question, whether this theorem or that was true, but whether it was useful to capital or harmful, expedient or inexpedient, politically dangerous or not. In place of disinterested inquirers, there were hired prize fighters; in place of genuine scientific research, the bad conscience and the evil intent of apologetic” (“Afterword to the Second German Edition of Capital” (1873), in Karl Marx, Capital, Vol. I, International Publishers, New York, 1967, p. 15).

With regard to today’s apologists, it is obvious that nothing has changed in this regard and that their rejection of the scientific content of Marx’s analysis is not innocent.

This study of the course of capitalism refers to the twenty-five countries of the OECD. One might object to its partial character. Actually, such an objection would
be not at all fair. This study addresses those countries in which the most advanced tendencies of the capitalist world can be verified, dividing them into three major geo-economic categories: Western Europe, North America and Asia, including Japan, along with some of the Pacific Rim countries of Southeast Asia. Elsewhere, the capitalist mode of production does not offer the same field for observation. The latter category includes countries that are either semi-developed, or else even undergoing regression (the allegedly former socialist countries), which, in any event, will never reach the level required to form part of the “triad” set forth above, as well as those that must be considered to be out of the competition altogether.

We have not thought that it was necessary to “update” this text, which was written in 1995. The “financial crisis” that has since struck Southeast Asia, Russia and Latin America, is nothing but an expression of the drastic and historical decline of the rate of profit that will henceforth characterize capitalism: due to its inability to invest in the real economy with any prospect of sufficient profitability, capital is becoming “speculative” for the purpose of artificial valorization, until the moment when a stock exchange crash takes place; this is what happened in October 1987 and then again in 1997 and 1998, but in the last instance with serious economic consequences as in Southeast Asia. In France, the proposed reduction of the work week to 35 hours will have no other effect than to incite the capitalists to modernize their productive apparatus a little more, which will cancel any possible job gains this proposal intended to create, while the “annualization of working time” demanded by the employers will result in making labor more “flexible”, that is, clearly, more productive.

I. The Accumulation of Capital and the End of Its Cycle

The accumulation of capital as goal

In order to avoid saying the word, “capitalism”, its apologists currently use the expression “market economy”. This expression is obviously not innocent. It is intended to foster belief in the existence of an economy whose purpose would be the production and the consumption of goods: commodities are produced, they are sold on the market and with the money made from this sale other commodities are purchased that will allow for the satisfaction of needs. Since everyone sells something, the entrepreneur who sells his “products” as much as the wage workers who sell their “labor”, we would thus be living in an economy in which the market is the means placed at the service of consumption. In this manner, the notions of exploitation, private appropriation, profit and capital accumulation are completely concealed.

Marx defined this kind of economy as “simple commodity circulation” and further defined it by means of the formula: Commodity-Money-Commodity; with C-M-C one sells in order to buy and one buys in order to consume: “Consumption, the satisfaction of wants, in one word, use-value, is its end and aim.”1 Marx used the example of the peasant who “sells corn, and with the money thus set free buys clothes”. For the contemporary ideologues of “the market economy”, this is how things take place today, more or less. This is, in fact, pure bunk. An economy of this kind, which functions according to the circuit C-M-C, prevailed when production was essentially carried out by small individual producers, artisans and peasants, the owners of their means of production, that is, when the economy was still pre-capitalist. With the expropriation of the great majority of these small producers for the benefit of employers who concentrated the means of production in their hands and utilized wage labor, “the market economy” became something completely different. Instead of C-M-C we have M-C-M: the circuit has been totally reversed, it starts with money and returns to money, but the latter emerges from the circuit in a larger amount than it started because “[t]o exchange £100 for cotton, and then this same cotton again for £100, is merely a roundabout way of exchanging money for money, the same for the same, and appears to be an operation just as purposeless as it is absurd”.2

This is the capitalist economy properly speaking, whose goal is not use value—which plays the subordinate role in the commodity circuit of a simple intermediary—but exchange value. In the old form of the simple commodity economy, one sold in order to purchase useful things for living and no one was exploited; in the capitalist commodity economy, one buys in order to sell for the purpose of “obtaining a profit”, or “making money”, and exploits the labor power of others; in order to do this, the capitalists who possess the means of production only need to buy human labor power for the purpose of extracting surplus value from it, since it has the property of being able to create more value than is required for its maintenance, or its wages; from then on, all that has to be done is to realize this surplus value in the form of money by selling the commodity in which it is crystallized on the market.

Capitalism exists from the moment when a certain quantity of money invested in production returns from the production process in a larger magnitude than it was when it entered it; profit is the difference between these two magnitudes. It is only in this circumstance that money is transformed into capital. But this circumstance is not enough to ensure the accumulation of capital. For, assuming that a capitalist, having realized his profit in the form of money, spends it on luxuries, driven by the desire for enjoyment rather than enrichment, in this case there will be no accumulation of capital; there will only be simple reproduction of capital: once his profits are squandered he will find that his capital is identical in magnitude to what it was when he started; he will be no wealthier than he was before.

For Marx, this simple reproduction of capital was the essential characteristic of the ancient economy: “But the ancients never thought of transforming the surplus-product into capital. Or at least only to a very limited extent. (The fact that the hoarding of treasure in the narrow sense was widespread among them shows how much surplus-product lay completely idle.) They used a large part of the surplus-product for unproductive expenditure on art, religious works and public works. Still less was their production directed to the release and development of the material productive forces—division of labour, machinery, the application of the powers of nature and science to private production. In fact, by and large, they never went beyond handicraft labour. The wealth which they produced for private consumption was therefore relatively small and only appears great because it was amassed in the hands of a few persons, who, incidentally, did not know what to do with it. Although, therefore, there was no over-production among the ancients, there was over-consumption by the rich, which in the final periods of Rome and Greece turned into mad extravagance.”3

The ancient world therefore did not produce for the purpose of accumulating capital. And if they “never thought of transforming the surplus-product into capital”, as Marx observed, this was because the productive forces were very underdeveloped: because their economy “never went beyond handicraft labour”, the surplus product, or profit, was also underdeveloped; for the latter to become really significant would have required a significant increase in the productivity of labor (if, in one day of labor, most of the worker’s time is devoted to reproducing his labor power due to the low productivity of labor, the surplus value extracted would be derisory), a development that in turn implied the development of machinery, the division of labor, and the application of the natural sciences to production, none of which existed in either ancient Rome or Greece. Otherwise, the ancient peoples would have “thought”, just like the modern capitalists, of transforming their surplus product into capital; they would have subjectively acquired the mentality proper to the latter, which Marx defined as “[t]his boundless greed after riches, this passionate chase after exchange-value”.4 In short, if the ancients did not feel impelled to engage in the appropriation of abstract wealth and its constant increase, this is because the historical conditions for the accumulation of capital did not exist.

When Marx speaks of the individual capitalist he does not hesitate to compare him to a hoarder. Like the latter, his “subjective aim”, insofar as he is “endowed with consciousness and a will”, is “the appropriation of ever more and more wealth in the abstract”.5 But the capitalist, as Marx points out, is not just any old miser: “But while the miser is merely a capitalist gone mad, the capitalist is a rational miser. The never-ending augmentation of exchange-value, which the miser strives after, by seeking to save his money from circulation, is attained by the more acute capitalist, by constantly throwing it afresh into circulation”.6

Another factor intervenes, however, a more objective one, which drives the capitalist to relentlessly throw his money into the circulation process: the competition of the other capitalists. For, if by chance he were to refrain from the incessant renewal of this operation, what would happen? In such a case, he would soon cease to exist as a capitalist. His competitors, having invested their profits more productively, in the form of more efficient machinery, more modern buildings, and additional labor power, will produce commodities more cheaply than our profligate or hoarding capitalist who emulates Harpagon, and the latter will be supplanted and quickly ruined by his competitors. Every capitalist is therefore subject to “the immanent laws of capitalist production … felt by each individual capitalist, as external coercive laws. It compels him to keep constantly extending his capital, in order to preserve it, but extend it he cannot, except by means of progressive accumulation”.7

There is still one more fact to consider. Because the capitalist is compelled to “[extend] his capital, in order to preserve it”, we see that there is another difference between him and the hoarder: by acting in this manner, he is forced to increase his productive capital. Capitalism as a system is not just a pile of gold that continually accumulates; it is also an industrial world that undergoes development: machines, buildings, workers’ labor power, all comprising the productive forces of society, productive forces that for Marx form the material basis of a higher form of society, communism. Of course, the capitalist has no use at all for this latter aspect of the system, since, “[f]anatically bent on making value expand itself, he ruthlessly forces the human race to produce for production’s sake; he thus forces the development of the productive powers of society, and creates those material conditions, which alone can form the real basis of a higher form of society, a society in which the full and free development of every individual forms the ruling principle”.8

This is the positive side of capitalism, without which the latter would have no historical value at all; otherwise it would be nothing but an absurd system that consists of the accumulation of abstract wealth, money capital, for the sake of accumulation. Besides, even the individual capitalist, unlike the classical hoarder, does not entirely surrender himself to this logic. Marx observes that, like Goethe’s Faust, “Two souls, alas, do dwell with in his breast”.9 During the first stage of the capitalist mode of production it was the first tendency, that of renunciation and avarice, which had the upper hand and constituted its exclusive passion, but with industrial progress it gave way to luxury and extravagance, although “the most sordid avarice and the most anxious calculation” are always lurking behind the capitalist’s enjoyments.10

The individual capitalist is one thing, however, and the capitalist system is another. In the latter, the individual capitalist is nothing but a cog in the machine. The system forces him, by means of the external coercion imposed upon him by the effect of the spur of competition to which he is subject, to act in such a way that the constant growth of the capital invested in his business becomes a necessity, and his supreme goal—or else he disappears as a capitalist—up to the point that, “[i]f to classical economy, the proletarian is but a machine for the production of surplus-value; on the other hand, the capitalist is in its eyes only a machine for the conversion of this surplus-value into additional capital”.11

Therefore, the accumulation of capital, and nothing else, is the goal! “That is Moses and the prophets!” It is also “the historical mission of the bourgeoisie”.12 A mission that no one has been able to cause to change course up until now, although some have tried to do so. Thus, Malthus, who already during his time, on the pretext of saving capitalism from the threat of overproduction, appealed to the capitalists to produce for the unproductive consumption of the idle aristocrats, the beneficiaries of government pensions and the clergy. This enraged Ricardo’s supporters, who were horrified by such an absurd proposal. For a more modern version of this notion, we may mention the critical ideologues of the “consumer society” who claim that capitalism is no longer anything but an out of control “productivism” and “consumerism”, which is alienating and destructive of nature but whose main vocation—production for the purpose of creating surplus value and the accumulation of capital—barely exists anymore.

In fact, if such a situation were actually to prevail, this would mean the extinction of production due to the loss of all incentive for the capitalists. Their goal is profit and the latter is not made to be consumed, but to be accumulated. If they were to act otherwise, others would take their place and they would be eliminated. Not only do capitalist enterprises not operate only to avoid losses, but they do not even operate at all without making a profit, which would condemn them to a condition of simple reproduction rather than the extended reproduction of capital. The one thing that the system can consent to, in certain historical situations, is to make the masses consume more, raising real wages, and accepting higher taxes imposed by the State on the profits of capital, in order to raise the level of the social wage. But it will only do so on the condition that this does not impede the pursuit of the accumulation of capital, and if the extraction of surplus value is increased thanks to a higher level of the productivity of labor.

If such a method of capital accumulation, accompanied by “mass consumption” and the “Welfare State”, becomes a hindrance, it will be challenged, as we are currently witnessing with “the end of Fordism” and the gradual return to “pure hardcore” liberalism. As another kind of con game, we shall also cite the environmentalist ideology that consists in attributing the evident degradation of the natural environment, not to capitalist development that, oriented towards the quest for maximum profits, results in such degradation, but to “material development”, considered as blind “productivism” whose underlying logic is not profit, but “technology”, and the latter leads to what will be called the “ravages of progress”. In reality, capitalism could not care less about material development, technology and progress, considered as autonomous categories. It only takes them into consideration if they can support its accumulation, insofar as they can serve as means that allow for the augmentation of the production of surplus value, while it will abandon them if they are no longer sufficiently profitable: as testimony to this fact, we need only refer to the industrial zones that, no longer capable of being attractive and dynamic poles of accumulation, are scrapped, delivered over to deindustrialization, and condemned to return to a condition of underdevelopment, since capitalism is unable to develop the forces of production unless they increase the volume of profit.

“Therefore, save, save, i.e., reconvert the greatest possible portion of surplus-value, or surplus-product into capital! Accumulation for accumulation’s sake, production for production’s sake: by this formula classical economy expressed the historical mission of the bourgeoisie, and did not for a single instant deceive itself over the birth-throes of wealth. But what avails lamentation in the face of historical necessity?”13

One question arises, however: how long can this infernal cycle of capital accumulation last? How long can such a “historical necessity” have a reason to exist?

The limits of capital

One may cite the existence of crises as a limit of the accumulation of capital. Crises take place because a problem arises on the market: in order to pursue the accumulation of capital it is not enough to extract surplus value from exploited labor power, it is also necessary to realize this surplus value in the form of money, and therefore, to successfully sell the commodities that contain this surplus value, which implies that one must find markets and buyers with money. If this is not accomplished, if the market does not absorb all the commodities that were produced, we have a crisis of overproduction. For Marx, the market ends up saturated because “[o]ver-production is specifically conditioned by the general law of the production of capital: to produce to the limit set by the productive forces … without any consideration for the actual limits of the market or the needs backed by the ability to pay”.14 Crises are precipitated, then, primarily by the anarchy of capitalist production: “The enormous power, inherent in the factory system, of expanding by jumps, and the dependence of that system on the markets of the world, necessarily beget feverish production, followed by over-filling of the markets, whereupon contraction of the markets brings on crippling of production.”15 This causes the accumulation of capital, instead of proceeding harmoniously, to proceed as a discontinuous industrial cycle, composed of stagnation, average levels of activity, prosperity and finally overproduction and crisis: the production curve ceases to rise and is replaced by one that falls, bringing about a situation of negative accumulation. But this depression is only temporary. Within a relatively short period of time, the infernal cycle of capital accumulation begins again. For this to take place all that is required is that the equilibrium is reestablished between production and the market. In order to bring this about, a mass of commodities is destroyed and factories are scrapped, while part of the working class, having become superfluous, goes to join the industrial reserve army. Once this “purge” has been completed, expansion can begin again. It starts slowly at first, and then a new productive frenzy takes possession of capitalist production until it swings towards the abyss of a new crash. And the same script is repeated.

Crises, although they appear to obstruct the system, are simultaneously the solutions to its contradictions. In fact, despite their periodicity, that is, their repetition at quite regular intervals, we observe that up until now (since 1825, the date of the first capitalist crisis, there have been approximately twenty of them), despite the fact that some of them have been especially severe (such as that of 1929), they have only been simple disturbances in the forward progress of capital accumulation. It is true that Marx thought that they would ultimately prove to be fatal for capital accumulation: “These contradictions lead to explosions, cataclysms, crises, in which by momentaneous suspension of labour and annihilation of a great portion of capital the latter is violently reduced to the point where it can go on…. Yet, these regularly recurring catastrophes lead to their repetition on a higher scale, and finally to its violent overthrow.”16 His prediction has not been confirmed up to this point. In this respect, Marx was only claiming that there would be such violent crises that they would provoke the collapse of the capitalist system; he does not tell us why they will eventually become fatal for the system.

More pertinent is his demonstration based on the decline in the average rate of profit, that is, the fact that capital advanced in production will yield, in percent, a constantly decreasing profit as the historical development of capitalist production advances. “Hence the concern,” Marx observes, “of the English economists over the decline of the rate of profit. The fact that the bare possibility of this happening should worry Ricardo, shows his profound understanding of the conditions of capitalist production…. Development of the productive forces of social labour is the historical task and justification of capital. This is just the way in which it unconsciously creates the material requirements of a higher mode of production. What worries Ricardo is the fact that the rate of profit, the stimulating principle of capitalist production, the fundamental premise and driving force of accumulation, should be endangered by the development of production itself…. There is, indeed, something deeper behind it, of which he is only vaguely aware. It comes to the surface here in a purely economic way — i.e., from the bourgeois point of view, within the limitations of capitalist understanding, from the standpoint of capitalist production itself — that it has its barrier, that it is relative, that it is not an absolute, but only a historical mode of production corresponding to a definite limited epoch in the development of the material requirements of production.”17

Today, the apologists of capitalism, and even some of its detractors, have introduced a deeply ingrained element of confusion: they present capitalism as an unlimited system of production, while it is actually a limited economic system because it does not produce for the sake of production, and much less to satisfy needs, but in order to permit the valorization of capital which, in step with the rhythm of its accumulation, declines, until the rate of profit falls to zero, and production will come to a halt and society will regress to an underdeveloped condition!

The rate of profit declines because, for any given capital, the proportion of constant capital (c) (machines, buildings and raw materials), which does not itself create surplus value, increases to the detriment of variable capital (v) (the living labor power that is necessary to set in motion the constant, or dead, capital) which has created it.

Thus, a capital of 100 units whose organic composition is 20c+80v will yield (based on a rate of exploitation of labor power of 100%) 80 units of surplus value and the rate of profit will be 80sv/100=80%. But if the organic composition rises and becomes 50c+50v, the rate of profit will fall to 50%. If it rises to 90c+10v, the rate of profit will fall to 10%, and so on until the constant capital (constant in the sense that it only transfers its initial value to the commodity that is produced) will assume such a preponderant scale in relation to the variable capital (variable because, by creating surplus value, it increases its initial value) that the valorization of capital will be, so to speak, nullified.

It is true that Marx took pains to emphasize that this fall of the rate of profit is a tendency: it can be temporarily counteracted by diverse procedures that have a tendency to revalorize capital. Thus, a reduction in the price of raw materials or of machines will tend to have the effect of lowering the organic composition of capital which, in turn, expresses a value relation and therefore will once again raise the rate of profit. The same result will be obtained by lowering the price of labor power (up to the point of reducing wages until they fall below the value of labor power), or by increasing the rate of exploitation of labor power (prolonging the part of the working time for which the worker is not paid, or decreasing the amount of time the worker labors to reproduce his labor power, or extending the length of the working day, or a combination of these methods). The effect of these countertendencies is to cause the fall of the rate of profit to be expressed in a nonlinear curve, which fluctuates and, viewed from a long-term perspective, can even rise after a stage of decline. But this revalorization of capital is only temporary since the dominant, and we may even say historical tendency, is always the same: for any given magnitude of capital, it is composed of a constantly growing proportion of constant capital (especially in its fixed component) and a constantly diminishing proportion of variable capital is necessary, and this always rising technical composition of capital has the effect of augmenting its organic composition (despite the decrease in the prices of raw materials and machines as a result of the increasing productivity of labor) and therefore leads to a fall in the rate of profit to an even lower level.

Marx then drew this final conclusion: “The real barrier of capitalist production is capital itself. It is that capital and its self-expansion appear as the starting and the closing point, the motive and the purpose of production.”18

In an especially rich chapter of the Grundrisse, he employs a different explanation of the limits of capital, a limit observed in this instance from the perspective of the relation between fixed capital and living labor. Thus, during the early days of capitalist production, the means of labor (the tools) had only a weak productive power, since the primary force of production was human labor power, with its arms, its brain, its nerves, its skills and its mastery of a trade. During this stage, Marx writes, “the quantity of labour employed [is] the determinant factor in the production of wealth”.19 But from the moment when machines are introduced, or rather, as Marx put it, “an automatic system of machinery … set in motion by an automaton, a moving power that moves itself” (Karl Marx, Grundrisse. Foundations of the Critique of Political Economy, Penguin Books, Baltimore, 1973, p. 692), it is the latter that becomes the “determinant principle of production—of the creation of use values” (ibid., p. 700). During this process, living labor “is reduced both quantitatively, to a smaller proportion, and qualitatively, as an, of course, indispensable but subordinate moment, compared to general scientific labour, [and the] technological application of natural sciences” (ibid.); it only subsists in the form of “the individual living workers” who are “subsumed under the total process of the machinery itself” (ibid., p. 693).

Nonetheless, we must not commit the error of believing that from that point forward it is the machine that, replacing living labor, creates surplus value and therefore allows for the revalorization of capital. In this stage, the machine is simply the principle agent of the creation of use value; it does not add exchange value to products except in two cases: 1) because it is itself a product of living labor it transfers, as it is used up, a certain quantity of this labor to the use values for the production of which it is utilized; 2) because its utilization allows for the increase of the productivity of the worker and therefore of the rate of exploitation to which the latter is subject. This having been said, the machine is under no circumstances a means of revalorization. To the contrary, by constantly expelling more and more human labor power from the process of production, it undermines the very foundations of the capital valorization process. Hence, Marx concludes, “[a]s soon as labour in the direct form has ceased to be the great well-spring of wealth”, that is, of use values, the exploitation of living labor also ceases “to be the condition for the development of general wealth”, and therefore “production based on exchange value breaks down” (ibid., p. 705).

Obviously, this kind of collapse of capitalism described by Marx is purely theoretical. Just like the fall of the rate of profit that tends towards zero, it is only an indication of the direction in which capitalism is headed due to the development of its fixed capital component. In order for this tendency to be completely realized there would have to be an almost total automation of production. It is, however, clear that before such an endpoint, one that would render capitalism totally impossible, is reached, capitalism will have collapsed long before, because the accumulation of capital will have entered a well-defined end stage of the cycle announcing its final collapse. This stage must be identified with precision and the theory of capital accumulation elaborated by Marx provides us with the key that allows us to do so.

Capital accumulation under normal conditions

The goal of capitalist production is to extract surplus value for the purpose of creating new additional capital. This surplus value, measured in relation to the invested capital (constant capital plus variable capital), is the profit, which is at the same time a simple “mystified form” of surplus value, as Marx says, insofar as it appears to be derived not from the exploitation of wage labor, but from the act of sale, profit appearing in this case as a simple differential between the market price of the commodities and their cost of production.

Over the course of capital accumulation, we have seen that the constant component of capital increases to the detriment of its variable component. The reasons for this rise in the technical and organic composition of capital are the desire for profits and competition among the capitalists. The latter want to expand their market share of sales, and therefore their mass of profits, and to do so they must reduce the cost of production of their commodities in order to be competitive. The most effective way to obtain this result is to introduce more efficient machines that will be cheaper than workers. We must point out, however, that the replacement of workers by machines will be determined by the wages of the workers. If the “price of labor” is low, so low that it is less than the cost of using machines, the capitalist will not introduce machines. The capitalist does not modernize for the sake of modernization, as if he were in love with technology. What is decisive for him is the final cost of the production of commodities. If the employment of new machines reduces that cost, he will not hesitate to follow the road of “modernization”. As a result, improvements in the production of machines, the greater diversity of their operational uses (the famous “innovations”), and their reinforced capacity for executing tasks in the production process, their utilization becomes increasingly advantageous and the general tendency is for constant capital to increase in relation to variable capital.

Here, however, a contradiction arises: if, for any given capital, the variable capital is diminished, the mass of surplus value (or profit) will be diminished to the same degree. Thus, if capital advanced in the amount of 100 units, which is composed of 50c+50v, yields, with a rate of exploitation of labor power of 100%, a mass of surplus value of 50 units, for the same amount of capital advanced, but whose composition is now 80c+20v, the mass of surplus value will be no more than 20 units. It is true that, in order to compensate for this loss, the capitalist can increase the rate of surplus value by increasing the amount of unpaid labor time (by prolonging the working day or by reducing the amount of time that is necessary for the reproduction of the value of labor power). But even allowing for the rate of surplus value to increase from 100% to 200%, the mass of surplus value will still not exceed 40 units, whereas it was 50 units during the first stage. And another phenomenon must also be taken into account. If we assume that the value of 20v represents 20 workers (1v=1 worker), we will observe that the number of workers has fallen precipitously compared to what it was under the former organic composition, when there were 50 workers.

At this stage, however, the contradiction is still a relative one. For, in order to increase the mass of surplus value, all that will be needed is to increase the amount of capital advanced, and at this point credit plays a decisive role if the capitalist lacks the requisite liquidity. Thus, if one multiplies the initial advanced capital by 3 (100 x 3) its organic composition will be 240c (80c x 3) + 60v (20v x 3), the mass of surplus value will be 60 and the number of workers will be 60, and therefore the number of workers will have been relatively reduced, but it will have increased in absolute terms.

It is this schema of capital accumulation that Marx utilizes in Volume I of Capital: “But, if the progress of accumulation lessens the relative magnitude of the variable part of capital, it by no means, in doing this, excludes the possibility of a rise in its absolute magnitude. Suppose that a capital-value at first is divided into 50 per cent. of constant and 50 per cent. of variable capital; later into 80 per cent. of constant and 20 per cent. of variable. If in the meantime the original capital, say £6,000, has increased to £18,000, its variable constituent has also increased. It was £3,000, it is now £3,600. But where as formerly an increase of capital by 20 per cent. would have sufficed to raise the demand for labour 20 per cent., now this latter rise requires a tripling of the original capital.”20 From these computations Marx draws the conclusion that the “[a]ccumulation of capital is, therefore, increase of the proletariat”.21

Once it has reached this stage, starting from a given amount of capital, the accumulation of capital encompasses, in conformity with the pace of extended reproduction, an ever-larger circle that extends its field of operations to the entire planet, although the effects of this process are felt to various degrees and unequally. This accumulation is accompanied by various tendencies: 1) due to the rise of the organic composition of capital, there is a tendential fall of the average rate of profit; 2) in parallel with this development, there is an absolute increase in the mass of profit or surplus value; 3) there is an absolute increase in the workers’ labor power, and only a relative diminution of the latter.

The fall of the rate of profit is compensated for by the increase of its mass and the relative diminution of living capital is compensated for by its absolute increase. As long as these contradictory tendencies can be reconciled, the accumulation of capital can proceed normally. It is only disturbed by the fact that it proceeds according to the rhythms of an industrial cycle that collapses (crisis), and then expands (recovery). But crises, as we have already pointed out, are only momentary interruptions of accumulation. When the latter is operating at its maximum efficiency, it can proceed without crises. This is what happened, more or less, during the “thirty glorious years” when capitalism disciplined itself by way of the state, and the latter immediately implemented “anti-cyclical” measures in order to launch a “recovery” as soon as an economic recession appeared on the horizon.

The accumulation of capital at the stage of the end of its cycle

Let us return to the schema we outlined above. In our last step, we had an advanced capital composed of 80c + 20v, which yielded 20 units of surplus value and a rate of profit of 20%. If we change the composition of the advanced capital to 95c + 5v, the mass of surplus value will be no more than 5 units and the rate of profit will fall to 5%. Under these conditions, for the mass of surplus value to rise in relation to the former organic composition, we will have to multiply the initial advanced capital by a factor of 5, which will give us 475c (95 x 5) + 25v (5v x 5) = 25 units of surplus value, with a rate of profit that is still 5%. In other words, from this point forward we need a considerable mass of capital in order to obtain a sufficient mass of surplus value: whereas previously it was sufficient to advance 100 units in order to yield 20 units, now we need to advance 500 units to yield 25 units. The devalorization of capital is therefore evident. In order to counter it, at least partially, it is of the utmost importance for capital to attempt to modify the relation that prevails between constant capital and variable capital.

The solution is to increase the rate of surplus value by increasing the productivity of labor. In this way, the time that the worker works to reproduce the value of his labor power will be reduced, and the time he works for free for capital will be correspondingly increased. This is the source of the famous “profits of productivity”. This method is not new, but by introducing even more productive machines (“high technology”) it was possible for the productivity of labor to rise spectacularly. Thus, it has been calculated that the productivity of labor more or less doubled between 1960 and 1992 in the major industrial countries.

Now, starting with an organic composition that has risen to 95c + 5v, but with the current rate of surplus value being 200% due to the increase of the productivity of labor, in order to extract a mass of surplus value of 25 units we only need to multiply our initial advanced capital by a factor of 2.5 instead of 5. Then we will have: 237.5c (95c x 2.5) + 12.5v (5v x 2.5) = 25 units of surplus value, thus making for a rate of profit of 10% instead of the 5% we previously obtained.

In this way, the rate of profit is partially reestablished and the mass of surplus value continues to grow; however, one new element in the accumulation of capital makes its appearance: by considerably increasing the productivity of labor by means of an ever more powerful machine technology, capital is led to absolutely reduce the number of workers needed for the production of surplus value. For, in order to produce 25 units of surplus value we no longer need any more than 12.5 workers (1v = 1 worker) whereas previously we needed 20 workers to produce a mass of surplus value of 20 units. Half of the workers are therefore definitively expelled from the production process.

Obviously, our example is schematic and in reality this absolute reduction in the number of workers is not reproduced in the same proportions, but it serves to illustrate an important fact: from now on, the accumulation of capital destroys more jobs than it creates. Whereas previously new investments increased the share of variable capital, now they have the effect of reducing it. In this case, after a conjunctural crisis, the economic recovery will not lead to a significant increase in the demand for labor, since in the meantime there will have been “restructurings” and “modernizations” eliminating personnel rendered superfluous for the production of surplus value and who will not be replaced.

This is the point at which capitalism enters the stage of the end of its cycle. The latter is not the end of accumulation, but points in that direction, for the pursuit of accumulation has the effect of gradually eliminating living capital; in other words, capital is henceforth actually sawing off the branch upon which it sits: it lives on living labor and it is replacing living labor to a growing extent by dead labor—the contradiction is obvious.

Marx glimpsed such an end to the cycle of capital when he wrote: “A development of the productive forces that would diminish the absolute number of labourers, i.e., enable the entire nation to accomplish its total production in a shorter time span, would cause a revolution, because it would put the bulk of the population out of the running.”22 Today, if we are not yet in a revolutionary situation, it is clear that we are in that situation characterized as “out of the running”, if not for the majority of the population, at least for a significant part of it—since, over the last twenty years or so, permanent, massive and increasing unemployment has become a fact of life in all the advanced capitalist countries.

Confronted by this situation, there is no shortage of charlatans who come to tell us that from now on production will be taken care of by machines, and that the latter rather than the workers will be responsible for producing wealth, and that the only problem that remains to be solved is the problem of distribution. This is to carry out an Olympian abstraction from the capitalist nature of this production, whose goal is not to produce “wealth” (use values) but to extract the surplus value that only living capital is capable of creating.

Share the work! That is what other charlatans proclaim—in fact, they are frequently the same ones. They claim that by reducing the length of the working week, without reducing the weekly wage, or by reducing it by a small amount, it will be possible to eliminate unemployment. In other words, if we return to the illustration of our initial schema, with 237.5c + 12.5v, based on a rate of exploitation of 200%, we have seen that we obtain a mass of surplus value of 25 units with a rate of profit of 10%; by “sharing the work”, therefore, by reducing the hours worked by 50%, the rate of exploitation drops to 100%, the mass of surplus value would be no more than 12.5 units (assuming the total wages remain the same) and the rate of profit would fall to 5%. This is the brilliant solution implied by the call to “share the work” issued by our charlatans who, within this same capitalism (which they have taken for granted as the unsurpassable horizon), want to have their butter and the money the butter costs at the same time! Work half the time and make the same money! To paraphrase Marx’s observation concerning Jeremy Bentham, one could say that these people are geniuses of petty bourgeois stupidity! In fact, even if the working day were to be reduced by a certain proportion, this would not create a significant number of jobs: with the “new technologies”, the workers will be forced to work under conditions of a much higher productivity of labor, which will cancel the creation of any new jobs.

Next we shall take a look at the various facets of this end of capital’s cycle, as they appear within contemporary capitalism.

II. The Various Aspects of the End of Capital’s Cycle

From the tendential to the absolute fall of the rate of profit

“The development of fixed capital indicates … the degree of development of wealth generally, or of capital”, according to Marx (Karl Marx, Grundrisse. Foundations of the Critique of Political Economy, Penguin Books, Baltimore, 1973, p. 707). The graph on the following page, concerning France, gives us some idea of this degree of development.

We see that from 1890 to 1950, the share of fixed capital invested per worker remained at a very modest level, as did its rate of growth: over a period of sixty years, it multiplied 3.7 times. During that stage, machinery was still far from having overtaken living capital. The machine, in general terms, was still no more than a complement to the worker. It only assisted him in certain operations, basically leaving him as the master of the job. After 1950, however, machinery took off, as the graph makes clear. Between 1950 and 1990, that is, over a period of forty years, it multiplied 10.4 times. Even though this figure, measured in francs, cannot be relied upon as an exact measure, it nonetheless gives us a good enough idea of its spectacular rise.

This great leap forward of machinery has been so enormous that in certain productive operations it has almost completely replaced the worker. This has been the case, for example, with the introduction of robotics, a by-product of the electronics industry. During the 1980s, it was estimated that there were 3,000 robots in France, 20,000 in Europe, and 65,000 in Japan (Japan has a broader definition of what qualifies as a robot). The various kinds of robots in use range from simple manipulative robots controlled directly by a human operator, up to the “intelligent” robots that are capable of understanding the functions required of them thanks to sensors.

[Graph omitted]: Value of Fixed Capital Invested per Employee (in francs per employee) (Source: A Century of Macroeconomic Data, by P. Villa)

Used primarily in the automotive and machine tool industries, robots are limited to welding, painting and manipulative operations. However, they are now having an impact on other sectors, such as agriculture/food production, chemical/pharmaceutical and construction, and sales of robotic equipment has increased by 23% in France in 1994 (see Le Monde, March 23, 1994). In fact, without even taking robotics into account, we can see that entire sectors, such as iron and steel, petrochemicals, and nuclear power, operate on the basis of a living capital reduced to its a minimum. As an example, we can cite the case of the Aluminum-Dunkerque factory of the Pechiney conglomerate which, with only 580 people, produces half of all the aluminum produced in France (see Le Monde, November 4, 1994).

Such a degree of mechanization is still exceptional. The organic composition of capital, however, as the above graph indicates, has in general risen considerably. Whereas in 1950 it was expressed as 87,000 francs of fixed capital per worker (the other component of constant capital, circulating capital, is not considered in this context), in 1993 it was 1,030,000 francs per worker, which means that the organic composition of capital was multiplied by 11.8 times.

Under these conditions, the rate of profit has had to fall because, “[t]his mode of production produces a progressive relative decrease of the variable capital as compared to the constant capital, and consequently a continuously rising organic composition of the total capital. The immediate result of this is that the rate of surplus-value, at the same, or even a rising, degree of labour exploitation, is represented by a continually falling general rate of profit. (We shall see later why this fall does not manifest itself in an absolute form, but rather as a tendency toward a progressive fall.)”23

With this last parenthetical statement, Marx alludes to the “counteracting influences at work, which cross and annul the effect of the general law, and which give it merely the characteristic of a tendency”.24 Marx enumerates the following influences: the increase of the rate of surplus value, the reduction of wages below their value, the reduction of the price of the elements of constant capital, and the investment of capital in colonies where “the rate of profit is higher … due to backward development, and likewise the exploitation of labour, because of the use of slaves, coolies, etc.”25 (which brings to mind today’s “relocations”). In other words, Marx is saying that the law of the fall of the rate of profit is entirely relative: it may trace a descending curve for a while and then, due to the various counteracting factors mentioned above, it may then rise again.

As a result of these fluctuations, some will say that it is hard to deduce from the phenomena a general law of the fall of the rate of profit, even one that is just a tendency. In fact, this could be true as long as the organic composition is not very high and only rises very slowly. Thus, if from an advanced capital of 10c + 90v, which yields a rate of profit of 90% (the rate of exploitation being 100%), we progress to a situation where we have an advanced capital of 20c + 80v, and the rate of profit falls to 80%, it will be relatively easy to counteract this decline; it would suffice, for example, to increase the rate of exploitation from 100% to 120%, which would yield a rate of profit of 96%.

This will no longer be the case, however, if the organic composition of capital undergoes a considerable increase. Thus, if the latter increases from a proportion of 20c + 80v to 80c + 20v, the rate of profit, which was initially 80%, will fall to 20%, and even if the rate of exploitation is increased from 100% to 200%, the rate of profit will still not exceed 40%. In this case, the law of the falling rate of profit is fully verified and becomes absolute: the rate of profit will never again be 80%, regardless of the procedures employed to restore it to its former rate. The figures provided for this example are obviously arbitrary, but they are useful for the purpose of illustrating this reality: as we saw above, with regard to the case of France, the fixed part of constant capital, after having only slowly increased over a very long period, suddenly took off after 1950 and multiplied 10.2 times between 1950 and 1990; even if, in the meanwhile, the rate of exploitation had increased (thanks to the advances made with regard to the productivity of labor, which increased between 1950 and 1990 by approximately 150%, according to data provided by the OECD), it is clear that the growth of the rate of surplus value has not been able to compensate for the negative impact on the rate of profit due to the spectacular increase of the share of the fixed part of constant capital.

We shall put it this way, without beating around the bush: if the fall in the rate of profit could be counteracted on every occasion in proportions such as would cancel out each instance of decline, it is obvious that the law of the falling rate of profit would hardly have any meaning at all. In fact, it must be pointed out that once constant capital has increased considerably (which presupposes a historically advanced stage of capitalism), the fall of the rate of profit that results from that increase in constant capital can only be partially contained, and that this fall must increasingly assume, instead of the relative form it has assumed until now, an absolute form, and eventually must result in a spectacular and irreversible devalorization of capital.

Today, such an absolute fall in the rate of profit is verified by the transformation of capital into a purely financial product, circulating in a closed circuit and upon speculative foundations. Effectively, we can discern an increasingly clear divide between the real economy and the fictitious economy: because it lacks the means for sufficient valorization in production, capital is trying to compensate for this shortfall by engaging in stock market and financial ventures where it appears that “money makes money” as if by magic. Since capital yields little in industry, the banks only reluctantly advance money capital for purposes of productive investment; they only do so at high rates of interest, that is, to the detriment of industrial capital; in this way, an important part of the surplus value extracted by the latter passes into the hands of finance capital; at the same time, due to the high interest rates, the owners of capital prefer to invest their money in finance capital, since this investment yields more than investment in industry; capital therefore hopes to artificially valorize itself in operations (speculations on the movement of interest rates and the value of currencies, and by means of mergers and acquisitions) in which it would seem to possess the power of self-creation, of creating its own surplus value disconnected from its productive basis; it then becomes a fictitious capital that, after having undergone excessive expansion in value, and thus engendering the illusion that it has become profitable at a good price, suddenly deflates, revealing that it was nothing but a “speculative bubble”, as in the case of the stock market crash of October 1987.

For this reason, we must emphasize this fact: the current vagaries of speculative capital, which go from one financial market to another at the speed of light thanks to computer networks, in search “of easy money instead of investment in production” (as the chorus of lamentation of the decomposed reformist left complains in a very capitalist manner), are not the bitter fruits of a neoliberal “policy” that, as a result of “deregulation”, has deliberately favored finance capital to the detriment of industrial capital, but are instead the consequences of a very real historical fact, that of the fall of the rate of profit that characterizes capitalism at the end of its cycle.

By saying this we are not claiming that the rate of profit cannot by any means be restored, as we shall see below. What is crucial to understand is that the latter, due to its absolute decline, is less and less capable of playing its role as “motive power of capitalist production” (Karl Marx, Capital, Vol. III, International Publishers, New York, 1967, p. 259).

The absolute decline of the surplus value producing working class

The rates of industrial employment, as a percentage of the total active population, for the six major countries of the OECD, during the years from 1960 to 1990, are shown in the chart below:

[Chart omitted]

Until 1970 there was an increase in the number of industrial workers, except for Great Britain (for the six countries taken as a whole, the average rose from 38.2% in 1960 to 39.7% in 1970). After that it declined regularly, falling to an average of 31.4% in 1990, a decline of 7.3%. The most spectacular decline took place in Great Britain, formerly the “workshop of the world”, which saw the percentage fall from 48.4% in 1960 to 28.7% in 1990. The country with the highest percentage of industrial workers is West Germany, with 39.1%. Over the course of the 1980s, job losses in manufacturing industries of the OECD countries are depicted in the following chart (in percentages per year):

Country % Change in Manufacturing Employment Per Year
Greece +1
Japan +.7
Denmark +.3
Germany -.05
Australia -.15
Canada -.25
Sweden -.3
Netherlands -.4
United States -.45
Portugal -.5
Iceland -.65
Ireland -.75
Spain -.8
Italy -.95
Luxemburg -1
Finland -1.2
Belgium -1.4
France -1.7
Norway -2
Great Britain -2.6

It can be seen that all the developed capitalist countries, except for Japan and Greece, lost industrial jobs during that period. For the United Kingdom, between 1980 and 1990, this loss amounted to 28%, or 2 million jobs; for France, it was 18%, or 1 million jobs; for Italy, it was 10%, or 600,000 jobs; for the United States, it was 5%, or 1 million jobs (between 1991 and 1994 it lost another 2 million jobs); for West Germany it was only 1%, or 200,000 jobs (but between 1991 and 1994 it lost 800,000 jobs in the metal industry alone—Le Monde, February 17, 1995).

In France, the changing employment figures by sector are shown on the following graph:

[Graph omitted]: Employment by Sector (in thousands, annual averages) (including temporary, part-time and apprentice workers, but not military personnel) Source: INSEE

While the commercial service sector gained 2,541,000 jobs and the non-commercial service sector (public services) gained 1,070,000 jobs between 1975 and 1993, the manufacturing and civil engineering/construction sectors lost 1,485,000 and 723,000 jobs, respectively.

Thus, since 1975, there has been an absolute decline in numbers of the members of the working class, that is, of that class of wage workers that is essentially responsible for the creation of surplus value, even if a fraction of the class in the tertiary sector, employed in transport, food supply, packaging and distribution, also produces surplus value.

In order to explain this decline, one could adduce the “relocations” of activities that are sent to the “newly industrialized countries”, especially to Southeast Asia, where wage labor is cheap. It is a fact that the share of the countries of Southeast Asia in world manufacturing exports has risen from 6% in 1970 to 16% in the early 1990s (see Alternatives économiques, No. 23), while the total value of consumer goods imported by the OECD countries from the countries of the Far East has risen from 40.1 billion dollars in 1985 to 95.1 billion dollars in 1990 (see the study published by the General Trust: Should We Be Afraid of the Newly Industrialized Countries in Asia?, April 1993). The clothing, watch-making, basic electronics, and toy industries, whose production processes still require a large proportion of human labor, have to some extent been shifted towards the low-wage countries where, therefore, the rate of profit is higher. As an example, we may cite the Thomson corporation, which employs 13,400 people in Malaysia, 5,400 in Singapore and 7,800 in Mexico, as opposed to only 4,300 in France and Germany. By virtue of the principle of communicating vessels, the fraction of the working class that was lost in the OECD countries, will be found in the countries of the periphery, which makes it impossible to speak of an absolute diminution of the working class if one considers the phenomenon on a world scale, where the working class instead has a tendency to increase, if not relatively, at least in terms of absolute numbers.

However, one other consideration must be taken into account. While it is true that relocations have led to job losses in the highly developed countries, the rise in exports of semi-finished products and machinery from the latter to the countries of the Far East, which have increased from 35.1 to 50.7 billion dollars in 1985 and from 64.5 to 111.1 billion dollars in 1990, respectively (according to the study published by the General Trust cited above), should have compensated for those job losses, as the increase in exports of capital goods should have served as a factor for job creation. Yet this is by no means the case, despite the fact that the exports from the OECD countries to the countries of Southeast Asia are much greater than their imports from the latter, as the former sell more to than they buy from the latter. The reason for this is that the growth of production in the highly developed countries is no longer a factor for job creation but, to the contrary, it contributes to job losses. This was revealed by a German study for the years prior to 1980: “Between 1953 and 1960, 100 billion marks invested in capital goods created two million jobs; between 1960 and 1965, the same amount of investment only created 400,000 jobs; between 1965 and 1970, it eliminated 100,000 jobs; between 1970 and 1975 it eliminated 500,000 jobs. And the pace of job destruction has continued since then.”26

We are now in the midst of the end of capital’s cycle. Advanced machinery has made possible a massive increase in the productivity of labor, and therefore of the rate of surplus value (between 1960 and 1973, productivity gains averaged 4.4% per year for the OECD countries taken as a whole); on the other hand, however, this advanced machinery has also had the effect of eliminating part of the working class that has become superfluous for the production of surplus value; we must point out, nonetheless, that if a fraction of the working class has been evicted from the circuit of valorization and is condemned to permanent unemployment, the fault does not lie with machine production itself (in order to prevent such unemployment all that would have to be done is to implement a corresponding reduction in working hours, and to maintain the same wages), but is due to the fact that this machine production is developing within the framework of capitalist relations of production which render such a solution impossible; unemployment is thus not “structural” unemployment, as some would try to make us believe, but capitalist unemployment, a very specific aspect of a capitalism that has arrived at the end of its cycle and which, by continuing to pursue its accumulation, definitively excludes a growing portion of living labor power from the production process.

If, as a result, it is true that the working class, on a world scale, is not shrinking in absolute terms, it is nonetheless also the case that, in the highly industrialized countries (which are responsible for approximately 70% of world production), such a process of absolute diminution is well entrenched, and the highly industrialized countries only show the other countries the image of what will soon be their own future:

“‘Group No. 1’, in Changchun, in northern China, is a city within a city (…). For ten years, the factory has been adapting to western norms. Whereas, between 1956 and 1985, only one million Liberation trucks came off its assembly lines, ‘Group No. 1’ now has to produce one million vehicles per year, of which 65% will be cars by 2005. In order to carry out what must undoubtedly be called a revolution, in 1985 the Chinese government transformed this state enterprise into a mixed private-public corporation, 40% of which is owned by Volkswagen. Today, the factory produces 140,000 trucks, 25,000 Golfs, 25,000 Jettas and 30,000 black Audis for the Chinese leadership class on four assembly lines, which represents one-fourth of Chinese auto production. In order to quadruple this production within ten years, the factory has no intention to create any new jobs. To the contrary, 7,000 jobs will be eliminated each year (….). Official statistics indicate that in Changchun the unemployment rate is already approaching 20% of the population” (Le Monde, October 10, 1995).

The rapid expansion of employment in the service industry and its increasingly artificial character

Capitalist production, due to its commercial character, requires a certain number of wage workers to be devoted to the sale of commodities, advertising, and commercial management; others work in banks, insurance companies, and the real estate sector; and yet others work for the state as administrators, teachers, health care workers, police, and in the military; finally, there is a whole layer of workers incorporated in the service sector working for corporations, local governments and private individuals. This entire “tertiary” sector is, in general terms, “unproductive”: it does not produce surplus value for capital, but constitutes capital’s “overhead costs” that are more or less indispensable for this mode of production.

Marx, in Capital, had already emphasized, with the development of machine production, the tendency of the ever more exorbitant increase of these “overhead costs” of capital: “the extraordinary productiveness of modern industry, accompanied as it is by both a more extensive and a more intense exploitation of labour-power in all other spheres of production, allows of the unproductive employment of a larger and larger part of the working-class, and the consequent reproduction, on a constantly extending scale, of the ancient domestic slaves under the name of a servant class, including men-servants, women-servants, lackeys, &c.”27 Today, this increase of “services” of all kinds has literally exploded. You be the judge:

[Chart omitted]: Percentage of labor force employed in the services sector. Source: OECD Jobs Report, 1994

For the countries listed in the chart above, since 1960, in France, the United States and Japan, the service sector has surpassed the industrial sector. In 1970, except for Germany, the tertiary sector was the largest sector. In 1990, it was larger than the industrial sector in all the countries listed. Thus, in 1993 the “services” were staffed by 87 million wage workers in the United States as opposed to only 18 million in industry. In other words, for each productive worker, almost five unproductive workers….

As you can see, it was between 1970 and 1990 when the percentage employed in services underwent a veritable explosion. While in 1960 the average percentage employed in services in the six countries surveyed was 42.8%, between 1970 and 1990 it rose from 49.2% to 63.7%. How, on the basis of these statistics, are we to understand such an increase?

In fact, the service sector jobs created during that last period no longer had much to do with the classical service categories (banks, insurance companies, etc., which, for their part, witnessed a tendency to decline). A large proportion of them are low-paid, unskilled, precarious “odd jobs”. Thus, the United States created 2.6 million jobs of this kind between March 1991 and February 1994. This led to a reduction in the official unemployment rate, which cannot, however, conceal its artificial character. Some commentators have been compelled to recognize this phenomenon: “In twenty years (in France) there have certainly been job losses: 1.8 million in industry (information technology and the increases in productivity thus achieved), 1.15 million in agriculture and 500,000 in construction. At the same time, however, 4.2 million service jobs have been created, in both the private and the public sectors. Of course, one could ask about the social benefit of these jobs: does the future of society consist in multiplying the number of security guards, home aids and call center employees?” (Alternatives économiques, No. 22, 4th Trimester of 1994, p. 14). These commentators console themselves by adding: “But these jobs exist, and they are multiplying”, rather than asking what is obviously the fundamental question: what good is such a capitalist society, that was based initially on the creation of a class of wage workers who produced surplus value and now turns 63.7% of these wage workers into unproductive workers? Pizza delivery drivers, hamburger flippers and other “local jobs”; is this the future of capitalist society? Will it still be able to reproduce itself?

It is clear that such “job categories” have all the hallmarks of the decline of the capitalist mode of production. They correspond to the end of its historical cycle. They are the artificial products of a system that is decomposing and that is trying to reverse the process by means of endless swindles, thus striving to “make work”, at the same time that it no longer has anything to offer, with massive unemployment and the increasing precariousness of the jobs that do exist there to remind it.

The rise of unemployment and expulsion from the circuit

As is depicted on the graph on the following page, the total number of unemployed in the twenty-five countries of the OECD has risen from 11 million in 1974 to 35 million in 1993. And this is the official figure, that is, the adjusted figure, since the real number is much higher: a large number of the unemployed are not counted as such since they are not enrolled on the official lists (or else because they have been deleted from the lists), whether because they are the beneficiaries of special programs (such as the RMI [subsidy for long-term unemployment—Note of the Spanish Translator]), or whether they are enrolled in “training courses” designated as “community employment contracts”, not counting those who are subjected to compulsory “early retirement”. In fact, there are 60 million unemployed workers of every description that should be counted. In France, the total number of unemployed according to the Minister of Labor was 3,306,000 in February 1995, i.e., 13% of the active population, whereas in reality the number exceeds 5 million.

To these figures we must add partial unemployment, which has been disguised as “part-time work”. These are the “precarious” jobs: temporary workers, short-term contractors, participants in various training programs, apprentices. In France, the number of persons in this category amounted to 1,404,000 in 1994, that is, 5.6% of the active population. In Great Britain they numbered almost 6,000,000, that is, 27% of all the wage workers (Le Monde, March 18, 1994). In the United States, 30 million people fall into this category, which means that 25% of the active population are employed working in “temporary jobs” (Le Monde, March 15, 1994). As can be demonstrated, such “under-employment” in these latter two countries is enormous. It also serves to artificially lower the official unemployment rate which, in the United States, was only 5.7% in early 1995.

[Graph omitted]: Millions Unemployed in the OECD Countries

In any event, in the light of the real unemployment figures, all governments are cultivating a truly “surrealist” artistic touch. “What kind of credibility can still be conceded, for example, to the official British or American data?”, asks Le Monde Diplomatique in its issue of July 1994. “The leaders of the United States themselves confess that the results attributed to the unemployment figures are based on ‘statistical anomalies’. As for the British results, according to John Wells, a professor of economics at the University of Cambridge, between 1 and 2 million unemployed persons ‘are overlooked’.” In a brief news item, the same journal reveals that “last January, after having taken into account the discouraged workers who are not counted by the official statistics, American Express calculated an unemployment rate of 9.6% for Japan (rather than 2.7%), 12.3% for Britain (rather than 9.8%) and 9.3% for the United States (rather than 6.4%). (Source: The Amex Bank Review, January 24, 1994)”.

Another example of falsification is offered by the fact that the newspaper Le Monde only takes into consideration the official unemployment rate for West Germany (7.5%) … although reunification took place four years before! And this is the same newspaper, on the other hand, that revealed (Le Monde, November 20-21, 1994) that unemployment in Germany was estimated at 5.3 million persons (3 million in the West and 2.3 million in the East), that is, a figure similar to that of 1933….

In any case, since 1974 the unemployment rate has undergone a vast increase and the question arises concerning just what this means.

Such massive and growing unemployment, which has successively struck all the highly industrialized capitalist countries, does not coincide with the classical industrial reserve army inherent to the process of capital accumulation. As can be seen on the graph immediately above, the industrial reserve army existed prior to 1974 in numbers ranging from 12 to 17 million persons. Even if some countries could boast of having realized, during the “thirty glorious years”, almost full employment, a country such as France, for example, which, with some 350,000 unemployed in 1973, now has at least 5 million unemployed, indicates that some other phenomenon is at work here: in twenty years, unemployment has multiplied by more than 14 times and such a rate of growth is far higher than the requirements implied by a temporarily out of work labor force (the industrial reserve army) needed for the accumulation of capital to proceed smoothly.

As the graph indicates, with the recession of 1974 unemployment rose to some 15 million persons. After that, however, instead of declining due to recovery, the number of unemployed continued to rise until it reached, on the eve of the 1981 recession, 23 million. Here we can see that economic growth during this period caused unemployment to increase by 8 million persons. With the recession of 1981-1982, unemployment underwent another leap forward until it reached 30 million. But then, although there was a decrease in unemployment of 6 million persons, the number of unemployed finally reached 29 million on the eve of the 1991 recession. While the subsequent recovery did not cause an increase in this number, it caused it to decline very little. With the recession of 1991, the official unemployment figure rose to 35 million in 1994 and it is obvious that the recovery, as we can see today, will have no major effect on employment.

It can thus be seen that if the various recessions have engendered unemployment, the recoveries that followed them were incapable of reabsorbing it, and even had the tendency at times, to the contrary, to exacerbate it. Since then, unemployment has only gathered momentum, as it has demonstrated a tendency, despite its ups and downs, to increase. This confirms the fact that once the “fat is trimmed” during a recession, enterprises “modernize” and make an effort to obtain profits with a reduced staff of wage workers. This is the kind of unemployment typical of a capitalism that has reached the end of its cycle: the accumulation of capital continues, but it does not cease to eliminate jobs.

The deep cause of this kind of unemployment is the imbalance, which will be flagrantly expressed from now on, between the development attained by the modern productive forces which, as has been seen, have by way of machine production made a gigantic leap forward since the 1950s, and the capitalist relations of production: law of value, market, wage system, profit. The latter are obsolete and their preservation leads to an explosion of unemployment. A growing mass of men and women can no longer manage to enter the framework of these relations and are excluded from them. As long as the capitalist mode of production set relatively simple productive forces in motion, it was capable of using the bulk of the labor power at its disposal. Despite its anarchic crises, which periodically threw masses of workers into the streets, it was capable of using them again once the economic recovery was underway. This is no longer the case today. From now on, the measures taken to end the crises no longer lead to significant numbers of additional, new jobs. For good or for ill capitalism pursues its accumulation with a diminished working class, while it leaves an increasing mass of workers in the lurch, who are rendered useless as far as the capitalist type of production is concerned.

Actually, this tendency was already operative prior to 1974. This explains why, in the United States, automation, according to Pierre Souyri, eliminated 2 and a half million jobs per year between 1955 and 1970.28 But this elimination of industrial jobs was not yet translated into massive unemployment because “tertiary” employment was undergoing a constant increase (it rose from 30% of the wage labor force in 1950 to 60% in 1968 in the United States), thus cushioning the force of the blow and preventing a major rise in unemployment. Beginning in the 1970s, however, such absorption of unemployment by way of service jobs was no longer possible. From that time on, massive and permanent unemployment became unavoidable and became clearly apparent. It also affected the “tertiary” sector, despite its continuous expansion during that period. This is why in France, in 1993, while the unemployment rate was 14.3% among industrial workers, it was 13.9% among office employees, 5.8% among middle level professionals and 4.9% among executives (Alternatives économiques No. 22, p. 17).

A situation then arose where unemployment struck all the categories of wage labor, the productive workers as well as the unproductive workers and even, to a certain extent, the aristocracy of wage labor: the executives, without forgetting the future “college graduates”, for whom “the social elevator is out of order”, as the tormented liberal Alain Madelin says. In other words, the “white collars” are feeling the squeeze, too. In this fourth compartment of the “tertiary” sector, which not so long ago was depicted as a new, comfortably situated petty bourgeoisie that had escaped the proletarian condition, the uncertainty of existence is on the increase. And in fact, with the most insignificant recession, a growing mass of these salaried petty bourgeois can sense the fragility of their situation: “During the recession of 1991-93 (in the United States), explains the ideologist of the ‘post-industrial’ society, Daniel Bell, more than 45% of the jobless were office employees, that is, twice as much as during the previous crisis, ten years before. The problems of IBM, the closure of enterprises, the shift of managerial and engineering jobs towards perfectly adapted new societies, no longer offers the security that ‘white collar’ status once guaranteed, so it was thought” (see Le Monde, March 2, 1995).

In fact, it is clear that from now on capital is dragging along this mass of “tertiary” jobs like a ball and chain, which it does not know what to do with and which weighs down, due to its unproductive role, its rate of profit. “Trimming the fat” in this sector renders it just as imperative to restructure and modernize the services. According to the views of the capitalist experts themselves, such a trend “could make 25 million jobs disappear in the United States in a private sector that has 90 million jobs (…). This is calamitous news for the millions of employees and mid-level executives in the service industry and for the workers who play subsidiary roles in that industry” (The Wall Street Journal Europe, March 19-20, 1993, quoted in Le Monde Diplomatique, July 1994).

But if the services have ceased to play the role of pressure valve for industrial unemployment, and they are themselves engendering their share of superfluous persons, what is happening at the other end of the chain? A surplus of unemployed is produced, from every social background, who find themselves totally excluded, and have no reasonable expectation of ever returning to their old jobs or even finding any job at all. This is already the case to a large extent in France, with 786,000 young people between the ages of 16 and 25 who in March 1993 were registered as unemployed; the same is true of the one million unemployed categorized as “long-term” unemployed, as well as the one million people participating in the RMI program, not counting the rejects, the unclassifiables, the anonymous, and the homeless, whose reinsertion into the workforce can no longer be seriously considered. And we must add all the illegal immigrants. The latter often find work in workshops where they are not legally declared by their employers at the same time that they are subject to an untrammeled exploitation. Others, however, are not so “lucky” and end up, in order to survive, engaging in all sorts of trafficking. In short, we have reached the poorhouse, the welfare office, the kingdom of crime, and the “hospital of the active labour-army”, as Marx called it. (Karl Marx, Capital, Vol. I, International Publishers, New York, 1967, p. 644).

To define all these welfare recipients, paupers, excluded, and underground people as unemployed persons, or to see them as nothing but a simple industrial reserve army, is utterly inadequate. The unemployed are workers who are temporarily excluded from the work force and Marx defines the industrial reserve army as a “stagnant” layer of the proletariat that is characterized by “extremely irregular employment” (Karl Marx, Capital, Vol. I, International Publishers, New York, 1967, p. 643). Those who are today called the “new poor”, the “long-term unemployed”, and the “RMIs”, are those who have been definitively ejected from the wage labor force, who live permanently on state assistance, on handouts from charities, on begging, or simply by scraping by somehow from one day to the next. In other words, they are the living expression of that definitive ejection from the circuit of part of the population when capitalist accumulation enters its end-stage of its cycle. “Capitalist production,” Marx wrote, “therefore, under its aspect of a continuous connected process, of a process of reproduction, produces not only commodities, not only surplus-value, but it also produces and reproduces the capitalist relation; on the one side the capitalist, on the other the wage labourer.”29 From now on, capitalism, with this process of exclusion, destroys that relation; instead of producing and reproducing the wage labor force, it eliminates it, in its own way: decomposing it, declassing it, transforming it into an amorphous social layer; it is no longer a matter of proletarianization, but of lumpenproletarianization. With this social decomposition of a fraction of the wage labor force, capitalism announces, in this respect as well, that it has entered into its final historical stage.

In conclusion, we shall say that it is not the existence of massive unemployment that causes capital to enter the period of the end of its cycle (during the crisis of 1929 unemployment was even more extensive), it is because unemployment, from now on, arises and develops with economic growth itself: between 1974 and 1991, the general index of industrial production rose by 17.9 in Great Britain, 19.5 in France, 27.5 in Italy, 32.6 in West Germany, and 38.4 in the United States, while at the same time unemployment has risen, for all the countries of the OECD (official figures) from 11 million persons in 1974 to 36 million in 1993; nor is it because of the return of the industrial reserve army (which existed to some extent before 1974), but because a large part of this mass of unemployed persons can no longer, unlike what took place in the past, expect to be periodically absorbed into active service in the industrial army, since they have been definitively excluded from the wage labor force.

III. From the End of the Cycle to the End of Capitalism

What end of capitalism?

As we have already pointed out, the end of the cycle of capital is not the end of capitalism, it is only capitalism’s last stage; a stage that could extend over an entire historical period but which will ultimately come to and end. Today, of course, when the ideology of capitalism has celebrated its crushing victory, and capitalism is “victorious”, “the unsurpassable horizon of humanity”, and “the end of history”, it sounds scandalous—or irresponsible—to speak of capitalism coming to an end. This is the opinion of not only the apologists, but also of many of those who still present themselves as critics of capitalism: the latter do not rejoice in its rule; they think that it is an alienating system, but at the same time they cannot conceive of its coming to an end, because they are so impressed by the ability it has so far demonstrated to overcome its contradictions, and to find solutions to escape from the impasses it encountered; as a result, persuaded that capitalism will always be able to “rejuvenate itself” whenever it seems to be undergoing its death throes, they eventually underwrote a complacent skepticism about its disappearance, and are always careful to avoid any kind of catastrophism, while at the same time engaging in facile sarcasm: “R. Boyer correctly recalls that capitalist social relations have for the last one hundred fifty years, and especially during the 20th century, proven their considerable flexibility and have also proven that those who have announced the onset of the ‘final crisis’ are behind the times”, as F. Chesnais, for example, writes in his book The Globalization of Capital.30

In fact, this kind of reasoning leads to a position that objectively supports the dominant point of view concerning the “eternity” of capitalism and “the end of history”. More precisely, behind the semblance of pessimism we most often find a dissimulated version of support for capitalism, that of “capitalism with a human face”: its proponents are not at all pleased with capitalism, but since they do not see how it can be made to disappear, they end up accommodating themselves to it as long as it undergoes some degree of “reform” and thus becomes more bearable. Hence the accent on its “considerable flexibility”, that is, on its possibilities for improvement, of “moderating” its ways if given a little help to do so.

This point of view is not new. It has historically characterized every social democratic current, all of which sought to rule out the economic collapse of capitalism. Today, this utopia of a capitalism without objective limits returns with a vengeance. By not seeing the current economic situation as anything but a “crisis”, its advocates rely on past experiences of crises in order to validate new reformist tinkering (“sharing the work”, etc.), thus imagining that what worked yesterday—fiddling with capitalism—can very well work again today. However, the failure of all the policies implemented during the last twenty years to exorcise the specter of increasing unemployment and exclusion, provides proof that this will not work. The reason for this is that since then capitalism has been undergoing something very different from a mere crisis. It has entered the end stage of its cycle. This end stage can be prolonged for the purpose of delaying the moment of the final collapse of the system, but the measures taken to achieve this cannot constitute a new springboard that will allow it to set in motion a new victorious dynamic.

It is precisely due to this end of capitalism’s cycle that here and there the vague and confused feeling arises that it can be abolished gradually. This nourishes a neo-reformism: there is a chance that we can implement a gradual and peaceful “transformation” that will lead to a new society whose contours are not very clear but which will nonetheless be a “post-capitalist” society. In other words, the contemporary phenomena that indicate that capitalism is now in the last stage of its cycle: the diminution of the surplus value-producing working class, the multiplication of unproductive jobs, some of which (the “odd jobs”) have hardly anything to do with the capitalist mode of production, and the pure and simple exclusion from the labor force of a fraction of the population that is being transformed into a kind of Roman proletariat living off the dole, will be so many reasons for the promotion of “structural reforms” that will have the effect of allowing for the smooth transition of society into a “post-capitalism”. This is the position, for example, of André Gorz, who elaborates such a neo-social democratic point of view in a book with the revealing title of Les chemins du paradis: L’agonie du Capital.31

This is the “optimistic” version of the end of capitalism. But there is also a “pessimistic” version, as exemplified by Pierre Souyri in his appendix to La Dynamique Du Capitalisme Au XXe Siecle.32 Souyri, although he begins by admitting that it is “impossible to conceive of complete automation within the framework of capitalism”, nonetheless imagines the prospect of this complete automation being established in some capitalist countries. On this assumption, these countries, due to the distortion of world exchange and the resulting compensation of the rate of profit, expropriate part of the surplus value produced by the countries that are less technologically developed, that is, the ones that still use significant amounts of living labor in production. Pierre Souyri then deduces that the countries where automation has been generalized will be able to reconvert the labor power that has become superfluous with regard to production to unproductive jobs, and this unproductive labor power will derive “its income, directly or indirectly, from the surplus value that comes from foreign sources”. From a capitalist point of view, however, what sense would it make for the most technologically advanced countries to expropriate part of the world’s surplus value, if instead of being used for capital accumulation it is devoted to maintaining their populations? Were they to do this, one would have to conclude that these countries have ceased to be capitalist countries, since they no longer function according to the logic of capital accumulation. Which would mean that this idea is a pure and simple fantasy with respect to the end of capitalism.

Pierre Souyri does not stop there. He considers, finally, another scenario where the most backward capitalist countries go the way of generalized automation. From the moment they do so, surplus value extraction is rendered almost impossible, and “capitalism decomposes from within” and with it all of society decomposes, and the consequence would be, Souyri explains, the existence of such large numbers of “plebian criminals” that the latter would have to be subjected to a “massive policy of imprisonment” or else pure and simple destruction: “The creation of concentration zones and various forms of genocide will then become the preconditions for domestic peace and for the survival of capitalist society under barbarous and absurd forms.” In fact, having reached this point, one could ask just what “capitalist society” we could still talk about!

Pierre Souyri’s vision is nothing but the symmetrical opposite of that of the neo-social democrat André Gorz. The latter imagines the end of capitalism will proceed according to a incremental, although “optimistic” process, and capitalism will disappear gradually in the form of a slow death and thanks to a series of reforms that will deliver us to the “paths to paradise”. Souyri also imagines a gradual process, but in his “pessimistic” version, capitalism disappears by decomposing from within and simultaneously drags society down into a “generalized barbarism”. As is evident, these two scenarios have one idea in common: the belief that capitalism will perish by means of a slow process of decline whose endpoint will be its complete decomposition, rather than as a result of contradictions whose most visible manifestations will take the form of increasingly more violent crises that will finally cause the collapse of the capitalist system, once these crises become insuperable as a result of the capitalism’s entry into the final stage of its cycle.

In fact, just as the phenomena of decomposition and social exclusion that were evident at the dawn of capitalism betokened the end of the cycle of the Middle Ages, the current phenomena of social decomposition indicate that capitalism has entered the final stage of its cycle. But none of them in themselves entail the end of capitalism. Because capitalism is “a contradiction in process” (Marx), only its crises can precipitate its end, crises that become insuperable and which bring about the abrupt collapse of the system. In other words, the theory of the decomposition of capitalism that entails its slow death, must be opposed by the theory of the collapse that leads to its violent death, as Marx had foreseen, once the system has reached its final stage: “These contradictions, of course, lead to explosions, crises…. Yet, these regularly recurring catastrophes lead to their repetition on a higher scale, and finally to its violent overthrow.”33

It is this process that leads the system to its doom, the process that is currently taking place in today’s capitalism, that we shall now analyze.

The partial restoration of the rate of profit

As we saw above, what characterizes capitalism from now on is its falling rate of profit. This situation leads to a slowdown that borders on paralysis. Investments are not sufficient, since the profitability of capital is deficient. Capital then has a tendency, as we have seen, to leave the productive sphere in order to become a purely speculative financial product. At the same time, unemployment increases, together with the risks of a “social upheaval” that could finally break out and endanger “the social consensus”. To partially restore the rate of profit in order to provide the economy with some dynamism then becomes the highest priority.

To achieve this goal, one of the means utilized is to subject labor power to more intensive exploitation, so that it will produce a relatively larger portion of surplus value. This is the meaning of the famous “productivity gains”. However, when we examine the history of these gains, we note that they have declined since 1973: whereas the rate of increase of the productivity of labor was 4.4% per year between 1960 and 1973 for the countries of the OECD, between 1973 and 1992 it never rose above 1.6% per year. Increasing productivity has proven to be only a very partial constraint on the fall of the rate of profit. The “new technologies” have not led to the expected results. To the contrary, by further reinforcing the predominance of fixed capital to the detriment of living capital, they have had the effect of lowering the rate of profit, due to the inability of productivity gains to compensate for this decline.

As a result, it is imperative for capital to try a different approach. While, during the 1980s, it never stopped singing the praises of “technological change” and other forms of “modernization” and the advantages they bring in their wake—soon we will have “factories without workers”, who will be replaced by robots and everyone will only work four hours a day, and there will be entertainment, culture, adult education programs—now all that modernist quackery is silenced and what we hear instead is a much more realistic and crude language, one that is, in short, frankly more capitalist: “reduce labor costs”, that is what it says!

What this means is, reduce real wages. Not only the wages of the workers who produce surplus value, but also those of the workers who work in sectors related to the realization of surplus value whose incomes lower profits because of the unproductive nature of their activity. Hence the repeated admonitions of international institutions like the IMF and the World Bank: Reduce the costs of doing business! Repeal minimum wage legislation! More flexibility of labor with regard to pay and hours of labor!

“Taking them as a whole, the general movements of wages are exclusively regulated by the expansion and contraction of the industrial reserve army….”34 With the ejection from the circuit, since 1974, of a growing mass of workers, composed of unemployed people of all varieties, the industrial reserve army is used to hold down the wages of those who still have jobs.

Furthermore, this industrial reserve army exercises its influence on a world scale: circumstances are therefore even more favorable for capital due to the immense reserves of the jobless. Hence the famous “relocations” of business to the other side of the world, where even cheaper labor power can be found. We must point out that these “relocations” do not exclusively follow the West to Southeast Asia route, as many people believe, but also go the other way. “The Asian ‘dragons’ have launched an assault on the British market”, reads the headline of the newspaper Le Monde in its issue of February 1, 1995. Thus, a representative of a Taiwan enterprise explained: “We want to minimize costs by moving closer to the European market. And labor is not cheap in Taiwan; it is no less expensive, in any case, than it is in Northern Ireland. Besides, we have a labor shortage and therefore the labor market is unstable.” For its part, the Korean corporation Samsung (No. 14 worldwide in sales) has decided to establish its operations in northern England and is doing so, as the same article in Le Monde points out, “largely because of its low cost of doing business: labor costs, we are told, are certainly a little higher than in Korea. But productivity is higher here. Thanks to the unemployment crisis in Europe and the significant rise in wages in Korea and Taiwan, the differential is being gradually reduced”.

So, in the guise of a wages “policy”, the job market acts as regulator: this is the only philosophy of “globalized” capital that underlies the reduction of wages in favor of the rate of profit. This process is still underway, as the chart below shows.

[Chart omitted]: Increases in Real Wages for the Lowest Paid Workers (average annual percentage increase or decrease during years indicated). Source: OECD Jobs Report 1994

We see that, during the 1980s, wages fell by 13% in the United States, 10% in Canada and 8% in Australia. They continued to rise, however, in all the other countries surveyed: 5% in France, 8% in England, 18% in Italy and even 25% in Germany. Nonetheless, these OECD statistics must be understood in their context. Thus in France, between 1984 and 1993, the monthly net wages of office employees and blue-collar workers stagnated (see Alternatives économiques No. 22, p. 41). On the other hand, according to Le Monde (February 11, 1995), “wages on the other side of the Channel are now closer to those of Taiwan or Korea than they are to those of the other member countries of the European Union”. And in the United States, there seems to be evidence of a surge in the numbers of “low paid workers”: in 1992, 18% of full-time employees made less than $13,000 a year (this figure is equal to the official poverty line), as opposed to only 12% in 1979 (Le Monde, April 4, 1994).

In any event, a certain disjunction is arising between the Anglo-Saxon countries, where wages are falling, and the other capitalist countries, where wages only display a tendency to stagnate, or even to undergo a major increase, as in Germany.

Which of these two tendencies will prevail? As usual, American capitalism shows the other capitalist countries the road they must follow. To restore the rate of profit to some degree, it is of vital importance from now on not only to put an end to “Fordism” (sharing the profits from productivity increases with the wage workers), but also to reduce wages. In any case, the direction in which we are heading is towards the accentuated pauperization of an increasingly larger mass of workers.

The great last resort: the return to liberalism

Starting in the late 1970s in the capitalist world, we began to hear a whole discourse that maintains that, from now on, only “market forces” are capable of restoring dynamism to the economy. And in order to allow these forces to work, we have to resolve to open up the borders so that the whole world will be one big free trade zone. This is what is called the “return to liberalism”.

This return to liberalism was depicted, by its opponents as well as its supporters, as “a choice”; a wise choice by its supporters, but a mistaken choice by its opponents. We shall see that this “choice” was actually a necessity for capital.

In order to understand why, we shall review some recent history. If we cast a glance back at the old capitalism from prior to 1974, what features does it display? Those of a patched up capitalism, half nationalized, that functioned on the basis of a “mixed economy” that a Marxist like Paul Mattick defined as follows: “‘Mixed economy’ means that a part of the national production remains production for the profit of private capital, while a smaller part consists of state-induced production yielding no surplus value.”35 This kind of capitalism emerged from the crisis of 1929. That crisis had dramatically revealed the insufficiency of demand. That was why, in order to overcome the crisis and prevent it from recurring, governments concluded that public consumption had to be increased, by means of public spending: it was the job of the state to stimulate demand. This was carried out during the 1930s by means of financing giant public works projects and, after 1945, buy way of a whole series of orders for goods from private business: transportation infrastructure, sports stadiums, hospitals, public housing projects, arms production, etc.

In this manner, as soon as there was any sign of a slowdown in economic expansion, the “pump was primed” by means of state-financed production. But where did the state get the money to finance its purchases? Largely from taxes on the profits of private business. This led to the following situation: the state, by submitting its purchase orders to private businesses, returned to them part of the surplus value that it had taken from them, but without this part thereby constituting additional, new surplus value, since it originated in the deductions previously imposed by the state on the private sector in the form of taxes.

This “mixed” functioning of capitalism could only be viable if the private sector produced a large enough quantity of surplus value to finance “public consumption”, which implied a relatively high rate of profit. The decline of the latter, consequent, as we have seen, on the spectacular rise of the technical and organic composition of capital, would lead to the general crisis of 1974, which was a crisis not of overproduction, but of the profitability of capital. From then on, the Keynesian prescription of “public consumption” was dead in the water. It was no longer possible to continue to increase the tax burden imposed on private business at the same time that the “life force” of capitalist production—the rate of profit—fluctuated dangerously. This gave rise to the universal protest of private capital, which cried out: Less government! Lower taxes! Fewer compulsory deductions!

The questioning of the “mixed economy” then became de rigueur. Under the right wing baton of the neoliberals, as also under the left wing baton of the social democrats, a gradual disconnection from the state as an agent of direct economic stimulus began: a whole series of state enterprises were privatized, or else restructured with a view to abolishing them as “public services” and subjecting them to the criteria of profitability. And the state was also put in the crosshairs as an agent of social redistribution: taxes on private enterprise were reduced, resulting in the decline of the “Welfare State”, as the latter saw its sources of income further depleted.

The appeal of the “return to liberalism” is obvious: it is an attempt to provide a means of restoring the rate of profit, allowing the laws of market to operate on their own, and to install the latter as the sole arbiters of the price of labor, eliminating the subsidized public enterprises and even circumventing the nation-state by implementing a borderless “globalized” system of free trade, where the multinationals reign supreme: there are 37,000 multinationals worldwide, with 200,000 subsidiaries; they employ 73 million wage workers and numerous subcontractors; in ten years their investments have multiplied by a factor of four, four-fifths of which were invested in the North and one-fifth in the South; furthermore, they have been transformed into “integrated conglomerates” (industrial groups combined with financial firms), which increases their independence.

Many commentators—from a wide range of perspectives—have criticized Marx’s Capital, accusing him of having based his analysis of capitalism solely on the liberal English economy of the 19th century, when other countries sensibly departed from that model—Germany and France, for example, where the state played an important role in the development of capitalism, which modified the way it functioned. This critique would make more headway after the 1930s, with the appearance of “mixed economies” that witnessed a reinforcement of the role of the state. At that time it was concluded that Marx’s analysis had been invalidated by the facts, by the transition of modern economies to an “organized capitalism” rather than the large-scale economic anarchy ruled by the blind laws of the market that Marx was believed to have deciphered. After that, Marx was reduced to the status of just another 19th century author whom one might read out of curiosity, but who was in any event now obsolete. With the “return to liberalism”, these criticisms of Marx have become outdated. The subsequent development of capitalism confirms his analysis. What he was capable of observing in 19th century England is now, at the end of the 20th century, verified, but this time on a world scale, where vast free trade zones have been established: the European Union (the EEC), the North American Free Trade zone (NAFTA), and Southeast Asia (ASEAN), this triad now being responsible for 95% of world trade. In short, with this “globalized” liberalism that has broken free of national borders and nation-states in order to become “transnational”, “multinational” and “uncontrolled”, never before has capitalism so closely approximated the pure theoretical model described by Marx.

The complaints about this liberal orientation of world capitalism will make no difference, any more than the exhortations for its regulation. “Globalization is not the result,” P. Frémeaux writes in Alternatives économiques No. 23, “of a pure determinism. It is as much the result of the choices made by the governments of the major powers, as it is of the mechanical dynamic of capitalism (…). Which is why we do not have to give up and believe that the forces of the market, from now on globalized, will henceforth be imposed on states, whose sovereignty is limited to their territories, and that they are therefore powerless to control them. Take the current financial disorder, for example: it cannot subsist against the will of the major Central Banks if the latter really wanted to put an end to it (…). Capitalism is not a runaway train that has gone off the rails. It also gives rise to counteracting influences capable of limiting its perverse effects: the demands of the wage workers who are calling for more justice in the South as well as the North, and economic, social and environmental regulations. Against the logic of economic war and the temptation to retreat within national borders, the real challenge is giving globalization a positive meaning.”

An admirable display of gallantry of this kind of contemporary rhetoric that characterizes the vaguely leftist petty bourgeois thinking that, from now on, in the guise of a “reformist” discourse, reduces its goal to a program of support for capitalism (“giving globalization a positive meaning”) at the same time that it tries to convince itself that “capitalism is not a runaway train that has gone off the rails”…. And that it will not be possible to stop, as we shall add!

Thus, obviously, liberalism is no panacea. It is nothing but the only possible form of a capitalism that has reached the end of its cycle. During the 1930s, it owed its salvation to the crutch of the state that helped it to get back on its feet and survive. Today, the state is no longer much help to it. It has become an obstacle for capitalism. Those “who make the decisions” preach that we can dispense with it without any major disruption and that after the Welfare State will come the Welfare Market. We shall observe its first effects.

The return of the crisis dynamic

After 1945, the capitalist economy was characterized by sustained and regular growth, with only a few weak slowdowns that state interventions assumed the responsibility for rapidly terminating. After 1980, growth no longer displayed the same upward course. Thus, for France:

[Chart omitted]: Annual Rise or Fall of GDP in France (in %)

As you can see, while the recovery after the recession of 1975 was quite vigorous (an increase of 4.2% in the GDP), the state having intervened with the help of a budget deficit, after the recession of 1980-1981 (in France there was only a slowdown in economic activity), the recovery was slight and unsteady; afterwards, there was a phase of average activity until 1987, then prosperity until 1989 and finally the crisis arrived that had broken out first in 1991 in the United States, only to spread subsequently to Europe shortly thereafter.

This is a mirror image of the classical industrial cycle that Marx had identified in the 19th century. Some analysts, who are by no means Marxists, also recognize this: it is the return of economic cycles. “For half a century, writes Denis Clerc, public intervention at least had the merit of allowing for a significant reduction of the extent of short-term fluctuations (…). The return of the cycles means that this half-century has come to an end. And that public intervention, henceforth stigmatized, is increasingly giving way to the regulatory mechanisms of the market” (Alternatives économiques No. 20; 2nd trimester of 1994).

If we are to believe the “certified experts” of the system, the recessions of 1974-1975 and 1980-1981 were the result of “two oil shocks”. The crisis of 1991-1993, the first crisis caused by the new liberal course taken by capitalism, the longest (it lasted almost three years) and the most serious the capitalist world has undergone since the crisis of 1929, merits a very different kind of explanation.

In order for the accumulation of capital to proceed, it is not enough to extract sufficient surplus value from exploited labor; it is also necessary to realize this surplus value in the form of money on the market. As Marx emphasizes, however, “[t]he conditions of direct exploitation, and those of realising it, are not identical…. The first are only limited by the productive power of society, the latter by the proportional relation of the various branches of production and the consumer power of society. But this last-named is not determined either by the absolute productive power, or by the absolute consumer power, but by the consumer power based on antagonistic conditions of distribution, which reduce the consumption of the bulk of society to a minimum varying within more or less narrow limits”.36

An objection might be raised in opposition to this analysis, to the effect that Keynesianism, with its various prescriptions of “full employment policies”, “public consumption” and “high wages”, was successful, at least to some degree, in staving off the onset of the limits of reduced mass consumption that Marx evoked. But as we have seen, capitalism’s entry into the final stage of its cycle has rendered Keynesianism obsolete: due to the fall of the rate of profit, the state has had to reduce its taxes on private business, and therefore also to reduce its “public consumption”, while capital has enforced more strict wage standards, and has even reduced real wages, as in the United States and Great Britain. With the rise of unemployment, millions of individuals have seen their incomes reduced to unemployment insurance payments that are also subject to constant reductions and pauperism has returned with a vengeance, affecting entire sections of the population, as in the United States, where 27.6 million people depend, as of January 1994, on government food stamps (Le Monde, April 4, 1994), or as in Great Britain, where 13.9 million people are living in poverty, as opposed to 5 million in 1979 (Le Monde, February 11, 1995). In other words, “the consumer power of society” has been reduced. This is the most important reason for the crisis of 1991-1993, since, as Marx explains, “[t]he ultimate reason for all real crises always remains the poverty and restricted consumption of the masses as opposed to the drive of capitalist production to develop the productive forces as though only the absolute consuming power of society constituted their limit”.37

“[T]o produce … without any consideration for the actual limits of the market or the needs backed by the ability to pay” (Karl Marx, Theories of Surplus Value, Part II, Progress Publishers, Moscow, 1968, Chapter 17, pp. 534-535) is for Marx the cause of the periodic fluctuations of the capitalist economy. With the return to liberalism, the capitalist economy has relapsed into that state of economic anarchy. With “globalization”, almost no one can be controlled. The borderless market, within which the multinationals obey only their impulses for enrichment, increasingly renders the economy more ungovernable by states. In order to remedy this state of affairs, a kind of “world government” would be necessary. But all attempts that have been made to move in that direction have only culminated in results that were the opposite of those intended. Thus, the G7 (the group of the planet’s seven richest capitalist countries), created in 1975, and which has held annual meetings since then, has restricted its efforts to making recommendations that accord with liberal orthodoxy. The World Trade Organization (WTO), which was created recently and replaced the General Agreement on Tariffs and Trade (GATT), has done nothing that goes beyond the latter’s code of good conduct.

Therefore, all the ingredients are present for the cycle of periodic crises to begin again. Denis Clerc was not mistaken when he said that this “alternation, increasingly more distinct, of phases of growth and phases of recession seems very much like a nostalgic photograph. For more than a century, between 1830 and 1940, capitalism was distinguished by such waves of activity” (Alternatives économiques, No. 20). But he forgot to mention how that cyclic movement culminated: the catastrophic crisis of 1929 that still haunts the memories of many people, that is, the bankruptcy of capitalism.

But we must also point out: it culminated in the bankruptcy of capitalism, no doubt, but one that was totally provisional. The reason for this was that, because it had not yet entered into its final stage of its cycle, it still had a significant margin of maneuver to escape the crisis. The problem that confronted it was how to sell its commodities, but it could resolve this problem without seriously threatening its profitability, since its rate of profit was still at a historically high level. That is why it was capable of finding the solution to its difficulties by means of various well-known Keynesian measures.

Today the situation is very different. Capitalism has entered the end-stage of its cycle whose most evident sign is the fall of its rate of profit, which from now on will be manifested in a form that tends towards an absolute decline and no longer a mere tendency. All the measures that it is currently implementing are intended to restore the rate of profit: reduction of wages, both in terms of direct pay and the social wage, and relocations in search of the cheapest possible labor power. In order to implement these policies it is compelled to turn to liberalism, with the market as the sole regulating force. This leads to a reduction in the capacity for consumption on the part of the masses and an ever more perceptible degree of anarchy on the market, and these two factors have the effect of driving capitalism towards a crisis dynamic. Since it can only proceed yet farther in this direction, because this is required by the profitability of capital, the crises can only become more violent until one of them finally triggers its economic collapse: unlike the situation in 1929, a “recovery” by way of public and private consumption will be impossible, because this would directly threaten the profitability of capital, which is already low, and would immediately lead to another impasse for the system.

To repeat, it is not “another 1929” that capitalism is headed for, but something that will have the appearance of a final crisis.

There is no unlimited accumulation of capital. If one does not admit this catastrophic career of capital that ends in “explosions, cataclysms, and crises” that will finally lead to the “violent overthrow” of capitalism (Marx), one must necessarily enter the mystifying universe of its apologists, who see it as a “natural and eternal” social form.

Epilogue

By evoking the end of capitalism in this manner we nonetheless leave an unresolved ambiguity: capitalism can, of course, economically collapse; but for it to really disappear revolutionary action is necessary, otherwise it will only rot in place.

This eventuality was not taken into account by Marx. For him, the final stages of capitalist development implied the exacerbation of its economic contradictions and, as a result, of its social contradictions, because “capital is not a thing, but a social relation between persons, established by the instrumentality of things”.38 In other words, the collapse of capitalism was at the same time the revolt of the working class against the bourgeoisie and its system, as the latter “begets, with the inexorability of a law of Nature, its own negation”,39 its “own grave-diggers”,40 the proletariat.

We are far from such a situation today. That portion of the proletariat that has borne the full brunt of capitalism’s assault—the unemployed, the precarious, the “excluded”—although they number in the millions, do not yet constitute more than a minority in relation to the entire wage earning class. For this reason, the bourgeois class has a sufficient margin of maneuver to contain the serious social disturbances that might suddenly break out: by distributing some crumbs (unemployment subsidies, special long-term unemployment subsidies, make work projects, etc.), it neutralizes this fraction of the proletariat. The situation of the latter also plays the role of a negative, dissuasive example for the rest of the wage workers: the latter still feel, for the time being, relatively safe, and refuse to take action out of fear of losing everything and thus coming to share the fate of the “excluded”. Finally, a subjective factor must be taken into account, which affects society as a whole. By its very ongoing development, capitalism has moulded the world and, consequently, the men who find themselves under its rule, in its own image.

The latter, conditioned and structured by capitalism, have ceased to belong to themselves and become instead, objects. Their thoughts and their actions have been transformed into those of capital, their master, the master of all. With the arrival of what Marx called “the real domination of capital”, alienation has never been so all-encompassing and modern societies have assumed the aspect of a vast system of material and spiritual slavery. The victorious cries of the current apologists for capitalism who are bragging about the triumph of “the market economy” are nothing but the noisy echoes of this alienation of men to capital. Even when they are abandoned and excluded by capital, they feel frustrated because they are disappointed that they no longer belong to it.

From this point on, we should not be at all surprised if capitalism’s entry into its final historical cycle is hardly even noticed. It will be seen as nothing but another “crisis”, that is, a passing misfortune that we have to get through while we wait for the system to recover its strength and once again vigorously continue its forward progress. In order to overcome this apathy and the mental blindness that dominates our epoch, it is obvious that capitalism will have to proceed yet further in its demonstration of its economic and social bankruptcy, and will have to strike down even more numerous masses of humans.

In the meantime, we shall observe nonetheless that the belief in a better future within the framework of capitalism will dissipate (this is demonstrated by the decline of ideologies and reformist organizations), that the faith in the ballot as a means to change the situation is eroding (which can be verified by the increasing level of abstention in elections) and that the myth of the social consensus is beginning to collapse to the point where one sees some bourgeois politicians raise the alarm (“the antagonistic classes have been reconstituted, whereas everyone, for decades, had agreed to dismantle them, declared Philippe Séguin in the last presidential elections. We can see that a great machine to reproduce and even aggravate social inequalities has once again arisen before our eyes”).

These are signs that ideological conformism and social apathy are not destined to last forever. “The passing of an illusion”, which a historian like François Furet41 believes to have diagnosed in communism (which he identifies with Stalinism!) could very well be, in a more or less not-so-distant future, applicable to capitalism itself.

• 1Karl Marx, Capital, Vol. I, International Publishers, New York, 1967, p. 149.
• 2Ibid.
• 3Karl Marx, Theories of Surplus Value, Part II, Progress Publishers, Moscow, 1968, p. 528.
• 4Karl Marx, Capital, Vol. I, International Publishers, New York, 1967, p. 153.
• 5Ibid., p. 152.
• 6Ibid., p. 153.
• 7Ibid., p. 592.
• 8Ibid.
• 9Ibid., p. 593.
• 10Ibid., p. 594.
• 11Ibid., p. 595.
• 12Ibid.
• 13Ibid.
• 14Karl Marx, Theories of Surplus Value, Part II, Progress Publishers, Moscow, 1968, pp. 534-535.
• 15Karl Marx, Capital, Vol. I, International Publishers, New York, 1967, p. 453.
• 16Karl Marx, Grundrisse. Foundations of the Critique of Political Economy, Penguin Books, Baltimore, 1973, p. 750.
• 17Karl Marx, Capital, Vol. III, International Publishers, New York, 1967, p. 259.
• 18Ibid., p. 250.
• 19Karl Marx, Grundrisse. Foundations of the Critique of Political Economy. Penguin Books, Baltimore, 1973, p. 704.
• 20Karl Marx, Capital, Vol. I, International Publishers, New York, 1967, p. 623.
• 21Ibid., p. 614.
• 22Karl Marx, Capital, Vol. III, International Publishers, New York, 1967, p. 263.
• 23Ibid., pp. 212-213.
• 24Ibid., p. 232.
• 25Ibid., p. 238.
• 26Quoted by André Gorz in Paths to Paradise: On the Liberation from Work, Pluto Press.
• 27Karl Marx, Capital, Vol. I, International Publishers, New York, 1967, p. 446.
• 28Pierre Souyri, La dynamique du capitalisme au XXe siècle, Payot, Paris, 1983.
• 29Karl Marx, Capital, Vol. I, International Publishers, New York, 1967, p. 578.
• 30F. Chesnais, The Globalization of Capital, Paris: Syros Editions, 1994 (first edition) and 1997 (revised edition).
• 31André Gorz, Les chemins du paradis: L’agonie du Capital, Éditions Galilée, 1983. English edition: Paths to Paradise: On the Liberation from Work, Pluto Press, 1985.
• 32Pierre Souyri, La Dynamique Du Capitalisme Au XXe Siecle, Payot, Paris, 1983.
• 33Karl Marx, Grundrisse. Foundations of the Critique of Political Economy, Penguin Books, Baltimore, 1973, p. 750.
• 34Karl Marx, Capital, Vol. I, International Publishers, New York, 1967, p. 637.
• 35Paul Mattick, Economic Crisis and Crisis Theory, M. E. Sharpe, White Plains, 1981, p. 139.
• 36Karl Marx, Capital, Vol. III, International Publishers, New York, 1967, p. 244.
• 37Ibid., p. 484.
• 38Karl Marx, Capital, Vol. I, International Publishers, New York, 1967, p. 766.
• 39Ibid., p. 763.
• 40Karl Marx and Frederick Engels, Manifesto of the Communist Party, in The Marx-Engels Reader, Second Edition, Robert C. Tucker, ed., W. W. Norton & Company, New York, 1978, p. 483.
• 41F. Furet, The Passing of an Illusion: The Idea of Communism in the Twentieth Century, The University of Chicago Press, Chicago, 1999.

An Investigation of This Supposedly Victorious Capitalism, Considered with Regard to Some of Its Political, Social and Ideological Aspects – Claude Bitot

Part 2

Foreword

In opposition to our contemporary lexicon of received opinion, according to which capitalism is a system possessing infinite capacities for renewal, development and transformation, we have instead maintained, in the first part of our “investigation”, that, economically, capitalism has entered the final stage of its historical cycle, a stage that cannot be precisely evaluated, since it may span an entire historical era, but will nonetheless inevitably culminate in a final crisis. The tendencies that are today taking shape only confirm this diagnosis. There has been no vigorous recovery. Capital still displays an aversion to investing in the real economy due to the lack of sufficient profitability. In fact, the bourgeoisie, as an industrial class, is becoming smaller every day. Its main activity has shifted to the stock exchange, towards “financial markets” and “pension funds”, as if money could reproduce itself magically, without having to pass through the production process, while we have the evidence of the “financial bubbles” that periodically burst, to prove that this is not so (like the last one, in 1998).

The purpose of this second part of our investigation is to show that this final stage of capital’s cycle is not verified merely economically, but that we may also observe evidence of its advent in the domain of the political, social and ideological superstructures of capitalism, as events in the economic subsoil of capitalism have not taken place without having an impact on its forms of domination. Without any pretension to offer an exhaustive treatment of the subject, we have focused on some of the aspects that have been affected.

We may thus observe clear evidence of a decline of the bourgeois nations, that is, the political frameworks in which capitalism has developed. Confronted by the return of regionalism, the rise of communitarian ideologies and, above all, destabilization by a capitalism that is now “globalized”, their foundations are being undermined at the same time that the very idea of the nation is being weakened.

Bourgeois democracy is not doing any better. Short-circuited by a “market democracy” with which only the commercial bourgeoisie and the affluent layers of society identify, it is withering away, increasingly abandoned by its electorate, while the political parties are undergoing a precipitate decline.

Caught in the storm of the final stage of capitalism’s cycle, the proletariat has been fractured into various segments that experience different conditions. One, the majority, still has stable employment, more or less well paid, with the social benefits that go along with it. Another has been completely excluded from the job market, condemned to public assistance and minimal social benefits, when not actually pauperized, which causes those who fall into this category to tend to undergo a process of lumpenproletarianization. Another finds itself in an intermediary category: one foot in the labor market, the other outside of it. This category is composed of those who are commonly called the “precarious”; they are actually a subproletariat that is occasionally utilized, having become very “flexible”, often low-skilled, badly paid, and despised, whom the Americans call the “working poor”. The emergence and expansion of such a layer of precarious workers mean that the capitalist wage labor force is collapsing.

Even the middle class wage workers, who are the pride and joy of the capitalist wage labor force, are affected. A fraction of this new petty bourgeoisie (especially its younger elements) can no longer find a place in the privileged milieu of executives and managers and is declassed, proletarianized, and forced to take subordinate positions in the workforce.

If we take a look at the prevalent ideological forms of contemporary capitalist society, we shall note that they are undergoing a process of decline. Political beliefs have collapsed, and no collective system of convictions functions any more. All that remains is a moralizing litany of the “human rights” variety, but without any real mobilizing power. Such a state of decay reveals the ideological vacuum that will henceforth overwhelm capitalist societies.

Finally, that which in the past was called “the moral order” is also undergoing a process of complete decomposition. The pillars of that order were Work, Family and Fatherland. All three have been shaken to their foundations and are eroding. For the moment, this decline has resulted, especially among the younger generations, in a moral disorder characterized by a vast array of disturbances and more or less violent behaviors, devoid of aim or purpose because of the loss of all points of reference.

***

The second part of this “investigation” is based for the most part on the capitalist society of France. Such a field of research might therefore seem to be too restricted. This having been said, French society is not an exception that is totally isolated with respect to the other capitalist countries. Because it is one of the elements of the bloc of “advanced” countries, whatever happens in France is also encountered, despite certain particular differences, in the other countries that have a comparable level of bourgeois civilization, although sometimes in different or more striking forms.

I

The Decline of the Bourgeois Nations

A little history

Nations were born in the early phase of the capitalist era in the 16th century. During that stage of their development they were formed under the aegis of the principle monarchies of Europe (England, France and Spain). The main activity of these monarchies was devoted to the construction of states that were centralized enough to impose their rule over the diverse local feudal powers. When, beginning in the 18th century, the bourgeoisie seized power, it continued to pursue the centralizing project begun by the monarchies, and at the same time attempted to transform the nations into the direct emanations of the “peoples”, with the notions of the republic and democracy. At that time the Nation-States that fully characterized the bourgeois and capitalist era were created.

For the capitalist mode of production, the nation constituted the proper framework for its development: a market that was extensive enough, freed from the feudal obstacles that restricted exchange and trade. In addition, it allowed the national capitals to protect themselves, if necessary, thanks to their customs barriers, from competing nations. This protection was even more important for the emerging capitalist nations. For the latter, whose capitalist development was not competitive enough compared to their more advanced national competitors, an all-encompassing policy of free trade threatened to abort the development of their still-underdeveloped economies.

During the 19th century, on the political plane, some national bourgeoisies had to wage fierce struggles to impose the nation-state in their respective countries. Thus, in North America, there was the Civil War that pitted the states of the North against those of the secessionist South. In Europe, there was the war for Italian unity against the Austrian Empire and the war for German unity against France in 1870, all of which allowed for the firm establishment of the national idea in these countries.

On the cultural plane, the national bourgeoisies had to fight against the surviving regional particularisms that constituted so many obstacles to the success of the idea of the nation. This struggle was fought with more or less determination, depending on the country involved, against the regional languages and dialects in order to impose a national language. Thus, in France, where this was accomplished by uprooting religious education, the nation became “secular and republican” at the end of the 19th century.

Finally, on the ideological plane, the national bourgeoisies transformed the nation into an almost transcendental idea: rallying all the classes behind it, in the nation there was only one community of citizens, one that was capable of “living together” in a “single and indivisible” nation. It was this extremely powerful ideology that served as the handle by which the peoples were driven off to war against each other, and became transformed into the saying, “to die for one’s fatherland is the most beautiful fate….”.

So we may summarize the historical progress of the bourgeois nations. An irresistible forward march, against which all contrary forces, whether reactionary (clerical) or revolutionary (the socialist forces that claimed to be internationalist), could mount hardly any resistance.

But how is it going for the nation today? We see that its forward march has come to an end and that from now on it is in retreat.

The return of regionalism, the rise of communitarianism, the decline of the idea of the nation

For some time now, those regionalisms that were thought to have disappeared have been making a comeback and are once again on the rise. Everywhere a consciousness of “identity” in search of its “roots” is emerging. Depending on one’s place of origin, one discovers that one is a Breton, a Corsican, a Savoyard, Flemish, Scottish, Welsh, Basque, Catalan, etc. Of course, this is by no means a new phenomenon. These regionalisms have often been forcefully integrated into the Nation-States, leaving only some of their particularities, even if only in the domain of language. What is happening today is that they are expressing the view that they were mistreated in the past and are therefore seeking revenge and demanding reparations from the Nation-States.

This cannot fail to lead to serious consequences, even in a country that is as traditionally centralized as France, which signed, on May 7, 1999, the European Charter on “Regional and Minority Languages”, which will become the law of the land when it is approved by the Legislature in 2000. This Charter calls for, among other things, the use “of the traditional forms of place names in the regional and minority languages”, the teaching of these languages in primary schools, “at least to those students whose families want it and whose numbers are considered to be sufficient”, as well as the encouragement of the use of these languages in the media.

We thus note this striking fact: with this Charter, the bourgeois nations, under pressure from the renascent regionalisms, seem to be dismantling the hard-won victories they had achieved over these regionalisms in the past.

***

Under the guise of “identity” consciousness we also discover categories that affirm their “differences” with respect to ethnic, sexual or religious groups. One therefore affirms one’s identity as an Arab, black, woman, homosexual, Jew, Moslem. What characterizes these distinctions is that they tend to establish so many more communitarianisms among those who, even if they are separated from one another, at least tend to think, feel, and react in terms of the group to which they belong. And this cannot but have an effect, in this respect as well, on the Nation-State.

Thus, in France, during the controversy regarding the wearing of the “Islamic veil”, or hijab, in school, the state, acting through the Council of State, legalized, so to speak, a practice that is in direct contradiction of the secular principles that underlie its republican educational system. This constituted a retreat in the face of the “right to difference”. The latter has been institutionalized in the name of a “multiculturalism” that is presented as a good law (“cultural variety can only lead to our mutual enrichment”), but which was actually a sign that the “integration machinery” of which the republican bourgeoisie was so proud, has some peculiar mechanical flaws.

This is also demonstrated by what is taking place in certain suburban areas, where not everything can be explained by unemployment or the depressing uniform landscapes of La Courneuve and Les Minguettes [on the outskirts of Paris and Lyon—Note of the Spanish Translator], as short-sighted economism or sociology would have us believe. When some young Arabs or blacks burn cars, destroy telephone booths, harass bus drivers and thus create a climate of fear, what does this mean? By acting in this way, these sons of immigrants assert their “difference” and their ethnic “identity”. Such a thing would have been unthinkable during the past, when Italian or Polish immigrants arrived in France. Despite some friction at first, they were rapidly integrated.

We shall also note an accelerated decline of the very idea of the nation, which is not unconnected to the phenomena we have just mentioned. After having been praised and idealized, it is now much less esteemed, even by the bourgeoisie. Thus, the war of 1914, which up until recently was considered to be “the Great Patriotic War”, is now not so far from being presented by the authorities in the same way that, in the past, the pacifists viewed it: as a vast butchery in which the various nationalisms confronted one another in an absurd war. In any event, the winds of our time no longer blow in favor of such an idea, presented as “archaic”, or else given an entirely pejorative connotation: Nation=nationalism, with all that “ism” implies with regard to chauvinism, xenophobia and narrow-mindedness.

Such a decline of the idea of the nation is not a French exception. Thus, what is the significance of the American “zero casualties” policy in the recent Kosovo conflict? It reveals the fact that from now on the American bourgeois nation is no longer prepared to accept the sacrifices that any real war implies. Its entire military operation, composed of ultra-sophisticated electronic gadgets which render the enemy incapable of mounting any defense, has no other reason for existing. After the painful experience of Vietnam, which saw the “boys” withdraw and American opinion turn against the government, it had to avoid a direct confrontation with the enemy that would run the risk of generating casualties that from now on can no longer be tolerated. From now on, what good is the American bourgeois nation, however powerful it may seem? Like all the others, it is in decline, and its idea is no longer worth the sacrifice of anyone’s life. In any event, even more than the other nations, America is being corroded by communitarianisms and ethnic identity movements, up to the point where the American universities are designing “a la carte” curriculums depending on the ethnic group to which one belongs.

***

How do we interpret these facts? We have recalled that nations have not always existed, contrary to what a certain nationalist mythology would have us believe; that they were imposed with the birth and the heyday of capitalism; as a result, if they are in decline today we must seek the real reason for this not in “politics”, or in “culture” or even in “the evolution of customs”, but in the capitalist economy itself.

The falling rate of profit, the “globalization” of capital and the decline of nations

“Globalization of capital”: just what does this concept, which one encounters everywhere, actually mean? The fact that there is now a world market? There has been a world market for a long time. It goes back at least to the 16th century. The world market means that each capitalist country, from its national base, produces commodities and exports them to the most distant corners of the world, in order to find buyers with money. “Globalization” is something very different. It is the hallmark of an increasingly more complete divorce between the nation and capital: with its “multinationals” and “transnationals” (numbering 37,000 worldwide, with 200,000 subsidiaries), capital is emancipated from its national framework, it is expatriated and without frontiers, and the world becomes its field of exploitation; with this kind of “globalization”, the idea of a “French economy”, or a “German economy”, etc., is losing its meaning; every “multinational”, as its name indicates, is composed of a multitude of capitals of various origins and operates according to its private interest, that is, without taking account of any “national interest”; it therefore will relocate if this is in its interest, even if it leaves a vast number of “national” workers in the lurch. It remains to be seen how capitalism arrived at this condition.

The most important fact that characterizes the capitalism that has reached the final stage of its cycle is the falling rate of profit, a fall that was previously relative and is now tending to become absolute (we refer the reader to Part 1 of our “Investigation”). From that point on, the imperative for capital is to locate a place to invest where profitability is still high enough, and to be prepared to abandon those zones where profitability is insufficient. In other words, regardless of where the investment is made, what is essential is that it should yield a good profit; if its labor power is too expensive or if its productivity of labor is too low, it is necessary to shift production from that locality in order to find satisfactory conditions for the extraction of surplus value. In short, what is called the “globalization of capital” is nothing but this mad scramble for the highest possible rate of profit; in other words, “globalization” is a result of the falling rate of profit, and at the same time it is an attempt to stem this decline locally by relocating where the profitability is still relatively high.

This “globalization” has resulted in increasing economic instability. Entire regions of the world have been spurned and abandoned, while others are still relatively prosperous economic poles. In Europe, northern France, Lorraine, Wales, Wallonia, the former German Democratic Republic, are disaster areas, undergoing a process of deindustrialization. Other regions that were already backward are now collapsing yet further into underdevelopment. This is the case with respect to southern Italy, Andalusia, and Scotland. Other regions, however, are showing signs of continuing economic dynamism. In this category we can include the Flemish part of Belgium, Catalonia, Lombardy, and the Rhineland.

As a result, under the impact of the effects of these instabilities, some nations will be just shattered into pieces, as the most prosperous regions have absolutely no desire to bear the burdens implied by the existence of the zones left behind by economic development. Thus, if Slovenia was the first region to separate from the Yugoslav Federation, this was above all because it had a per capita GNP that was between 2 and 3 times higher than the average per capita GNP of the Federation. The same thing happened to the Czech Republic, whose GNP was higher than that of Slovakia, and these two national entities separated “amicably”. The same could be said of the Ukraine, which became independent of the former USSR.

Furthermore, these economic imbalances nourish a desire for greater autonomy on the part of the prosperous regions. As in Catalonia, which alone produces 20% of the Spanish GDP and where numerous multinationals have been established: in the chemical industry with Air Liquide, Rhône-Poulenc, Elf, Atochem; in the automotive sector with Volkswagen and Fiat. Hence the pressure imposed by the Catalan bourgeoisie on the central government for lower taxes and more autonomy. The Flemish part of Belgium has also become a privileged site for the multinationals. Alone, it generates approximately 75% of the GDP of Belgium and “‘federal solidarity’ feels more and more like a ball and chain. The transfers of funds for social security or unemployment insurance constitute, in the eyes of numerous Flemish officials, a hindrance to the competitiveness of their region” (Le Monde Économique, March 18, 1999). The same is true of Lombardy, which alone produces 20% of Italy’s GDP and whose unemployment rate is half the national average. There, too, a powerful desire for autonomy, and even separatism, has arisen, with the Northern League of Umberto Bossi. In short, it is the same old story: the rich do not want to pay for the poor, which has the effect of undermining the Nation-States.

For their part, the regions left behind by economic development have also made their contributions to this destructive labor. Feeling abandoned, they perceive their union in a nation with much less interest and feel more or less tempted by the prospect of independence. This is what has taken place in Corsica, Wales, Scotland (which now has its own Parliament for the first time since 1707) and Wallonia (which is host to a current, known as the “unioniste” movement, that wants to unite with France).

Finally, some communitarianisms in the peripheral neighborhoods of the disinherited are prone to the same impulse. They, too, are attempting, more or less consciously, to secede from the Nation-State by constituting separate entities where, for example, the police will not interfere in local business (generally linked to drug trafficking), thus depriving the “legal state” of control over its territory.

The “European Structure” and the decline of nations

Given these developments, within the context of the “globalization” of capital that is destabilizing the nation, what is the significance of the project of the “European Structure”? Must it be understood as an attempt to counteract this decline by creating an even larger collective unit? If we consider the debates currently underway among the various national bourgeoisies with respect to this matter, the least we can say is that they seem very much divided over the question of the validity of this project.

“Will France Disappear?”, is the anxious query of a book by the Gaullist J. C. Barreau (published by B. Grasset in 1997). Barreau is a representative of the bourgeois fraction that is opposed to the ongoing European project. He thinks that the Euro, the European Central Bank, the Brussels Commission, and the Treaties of Maastricht and Amsterdam are threats to national sovereignty, and that the latter is no longer the source of the integrity of laws and regulations. On this basis he paints a dire picture of what could happen if such a process of national dissolution were to proceed to its logical conclusion: a Balkanized France, delivered over to tribal warfare, doomed to disappear in an indescribable chaos…. In view of this prognosis, this bourgeoisie is quite aware of what is going on: with the “European Structure” there is certainly a decline of the national entity. For what is a “national” bourgeoisie that has to pass under the Caudine Yoke of higher authorities that presume to dictate its conduct over a wide range of domains? Obviously, such a bourgeoisie is no longer the master of its fate. But what solution does he propose? More or less, the return to full national sovereignty. His opponents will respond: is this a realistic proposal? In fact, given the “globalization” of capital, a retreat back to the nation appears to be especially risky, not to say impossible: upon what economic foundation will the nation be based and thus exert its independence? In reality, such a proposal stems from a bourgeoisie that is nostalgic for the past, a bourgeoisie that ideologically imprisons itself in a vain desire to turn back the clock, thus imagining that it will be able to exorcise the ineluctable decline that is overwhelming the bourgeois nations.

Another fraction of the bourgeoisie believes that it can overcome this decline, but in a different way: it wants to plunge headlong into the “European Structure”. This bourgeoisie dreams of a new nation, on a larger scale, more powerful, that would be called “Europe” and will thus be capable of confronting the American colossus by throwing all its weight onto the scales. It therefore proposes that the European Union should provide itself with a parliament that has real legislative power, a government that is no longer dependent on the various national political powers, and the joint military defense force that is implied by an independent government. Such a project is, in fact, just as unrealistic as a return to the past: the tendency of contemporary “globalized” capitalism, as we have seen, is not towards the unification, but towards the fragmentation, and even the dissolution of nations; all national borders have become obstacles for it, not only in the old nations but also in the new ones that will eventually arise.

In fact, the “European Structure”, such as it exists in its current form, has assumed the only possible form: a free trade zone, and a certain number of institutions that restrict national sovereignty (the European Court of Justice, the Euro, the European Central Bank, the Brussels Commission), but which do not entirely abolish it (the Council of Europe is still the creature of the various leaders of national governments, its decisions must be unanimous rather than by majority vote, while the Parliament in Strasbourg does not wield full powers); this is the Europe that has the support of the majority fraction of the national bourgeoisies. It allows them to form a more or less united bloc in international trade negotiations; to prevent, as far as possible, the exacerbation of imbalances in regional economic development by allocating funds to the less favored regions; and, finally, it is a good way to impose compulsory regulations affecting social policies (such as the recent reintroduction of night shift work for women), immigration, etc. This Europe that wants to have its cake and eat it, too, corresponds closely enough to the state of decline of the bourgeois nations: too weak from now on to act alone, they are obliged to pursue some degree of unification, but not so much unification that they disappear as separate entities. Finally, we shall add that a “Greater Europe”, numbering 20, and even 27 (!) countries, as is planned, far from resulting in more cohesive unity, will only accentuate the already existing confusion.

Tendencies towards the fragmentation and break-up of nations in the rest of the world

But what is going on in other parts of the world? Instead of a decline of nations, has there not been a resurgence of nations, accompanied by a return of nationalisms, as recently demonstrated in Yugoslavia?

We shall refrain from analyzing the geopolitical considerations that led the Western powers (the USA, England, Germany, France) to throw fuel on the fire of the Yugoslavian inferno, which did not need their interference in order to burst into flames, and proclaim this inescapable conclusion: the Yugoslav Federation has ceased to exist; it has broken up into distinct pieces to such an extent that the only “Yugoslavia” that remains is Serbia itself…. It has been replaced by a myriad of tiny political entities (Slovenia, Croatia, Macedonia, Montenegro, Kosovo) which cannot be reasonably defined as “nations”, as is evident due to their small size and their artificial borders. Instead of “nationalisms”, what we have witnessed in the former Yugoslavia is the destruction of a nation and an unleashing of tribalisms, of warlords, and of the mafias that wave the flag of nationalism in order to provide a cover for their crimes. This has nothing to do with the real historical process that led to the formation of nations, such as took place in the 19th century with the achievement of German and Italian unity.

We are now getting a glimpse of what is happening further to the east in Europe. As we pointed out above, the Czechs and the Slovaks have “amicably” separated. Meanwhile, two new “nations” have been born…. The case of the former USSR is different, however. The USSR was not a nation; it was an empire. Inherited from the old Czarist Empire, a multitude of Asian “republics” were added to the self-styled Union of Socialist Soviet Republics. Once the USSR broke up, a kind of decolonization process has taken place. So far, so good. However, the petroleum resources that are located in this region are not at all unrelated to this “decolonization” process…. But what meaning can be attributed at this time to the appearance of the Ukrainian and Belorussian “nations”, which traditionally formed part of White Russia? It means that we are witnessing a process of Balkanization that is spreading to the far east of Europe.

Finally, let us cast a glance at what is happening in the rest of the world. What we are witnessing is a proliferation of new states on the planet. There are now approximately 200 of them and this tendency has only just begun. But mark our words: it remains to be proven that this represents the proliferation of states, that is, of real nations.

***

In view of these developments, we can make one general assertion. The new “nations” that, in the name of the “right of national self-determination” (a pretext that is always available), which are sprouting up everywhere like mushrooms, arise from separatist movements or the breakup of old nations; the process by which this takes place by no means corresponds with the process of unification in a particular region that occurred in the past when nations first arose (at the end of the Middle Ages, that is, during the 16th century, there were some 500 political entities in Europe, while at the beginning of the 19th century there were no more than thirty, subsequent to bourgeois and monarchic centralization); their existence is nothing but the sign of a capitalist development that is running out of steam and thus provokes this tendency to fragmentation and diminution. Even the American Superpower is not immune to such fragmentation, which is frequently proposed on the basis of ethnicity. Thus, when the Latinos become the majority in the South and the West Coast of the United States, it is not unreasonable to imagine that they might point out that Texas and California used to belong to Mexico…. And who can assure us that, in China, the central government will be able to contain for much longer the centrifugal forces that are already at work and that these forces will not end up leading to the breakup of the country? All of these considerations support the claim that the time for the constitution of new nations has come to an end (that historical trend ended, more or less, in the 1960s, with the anti-colonial movements in the Third World) and that the danger we face during the course of this final stage of capitalism’s cycle is a Balkanization of the planet.

We may thus conclude as follows: within the framework of capitalism, which is approaching its end, the old nations, the historical bourgeoisies, are in decline, and the new bourgeoisies that are rising and multiplying are the products of the decomposition of this capitalism.

II

The Decline of Bourgeois Democracy

A brief review

The word democracy, in the capitalist regime, must not be understood to mean “government by the people”, as its etymology might lead one to believe. Of course, political power in that democracy derives from the people, since it is the people who, with their right to vote, choose their representatives in the legislature. But this formulation overlooks the fact that the people are divided into classes and that in a class society, “[t]he ideas of the ruling class are in every epoch the ruling ideas, i.e. the class which is the ruling material force of society, is at the same time its ruling intellectual force. The class which has the means of material production at its disposal, consequently also controls the means of mental production, so that the ideas of those who lack the means of mental production are on the whole subject to it” (Karl Marx and Friedrich Engels, The German Ideology, Prometheus Books, Amherst, New York, 1998, p. 67). Thus, the ruled classes can vote as they wish, as long as the bourgeoisie, that is, the class which in capitalist society possesses the material and the spiritual power, knowing in advance that the opinions of the ruled classes will be subject to them, will always be sure that the elections, and therefore, political power, will always remain in its hands. Such a democracy is, then, only in a formal sense “government by the people”; its substance is bourgeois.

The “political freedoms” that have been established in such a democracy (freedom of opinion, expression, assembly, association) are all equally formal. Because the bourgeoisie is the ruling class that “has the means of material production at its disposal” (schools, universities, press, radio, television, publishing), it is easy to proclaim the existence of a “plurality of opinions”, which actually means the plurality of bourgeois opinions, that is, their complete dissemination, in all their diversity and varieties, through the major media and under the direction of a myriad of politicians, journalists and intellectuals, while ideas contrary to bourgeois society, revolutionary ideas, are simultaneously necessarily relegated to marginalization, since they are not the ideas of the ruling class.

As for the legislature, its essential function is to allow the various fractions of the bourgeoisie to assert their specific interests. The diverse “nuances” and other “political factions” can thus come to debate and vote on the laws that are in their interest, which leads to all kinds of crude maneuvers and manipulations. It is true that the legislative chamber contains a left and a right, but this does not mean that two antagonistic forces confront one another, but simply that there is a camp that is more conservative (“the right”) than the other (“the left”), the latter seeking to make bourgeois society develop somewhat with the help of certain reforms, without, obviously, really subjecting it to challenge, in order to make it stronger.

From “social democracy” to “market democracy”

This picture of bourgeois democracy that we have just rapidly sketched, however, needs a little touching up. Within the framework of modern capitalism, especially after the 1930s, democracy assumed a somewhat social aspect. After the great crisis of 1929 it was necessary, for reasons of social stability, to pay a little more attention to the interests of the popular classes, and above all to those of the working class. The state then began to play a certain redistributive role: by means of the parties of the left, but not exclusively (thus, in France, the right wing Gaullist party played this role after 1945), the bourgeois class consented to certain reforms, such as social security, paid vacations, pensions, etc. This had the effect of reinforcing the reputation of bourgeois democracy, which had been somewhat tarnished during the 1930s. From then on, social democratic or Christian Democratic “policies” (as in Germany with its “social market economy”) came into their own.

It is, however, precisely these “policies” that are now under attack. Stunned by the falling rate of profit, capital has devoted all its energy to an attempt to restore the rate of profit as much as possible. It is therefore less and less willing to allow itself to be drained by these “policies”, as was previously the case with the “Welfare State”. As loudly as it can it calls for lower taxes and fewer regulations that are burdens on business. Suddenly, governments are forced to reduce their budgets and cut back on social spending and reduce taxes. And if by chance they happen to do anything that even slightly impinges on the interests of capital—“of the markets”—they are subjected to pressure in the form of the specter of capital flight or business relocation, and are subjected to the compulsory rule of “globalization”….

“France’s policies are not decided at the Stock Exchange”, De Gaulle boasted in other times. Today, a vainglorious boast of that kind would be totally inconceivable. Under the guise of “policy”, all that anyone needs to know is how “the markets” will react. Evidently, government leaders are still trying to give a convincing performance, however. Such as Prime Minister L. Jospin, for example, who recently proclaimed: “Yes to the market economy, no to market society”. This is the very pinnacle of charlatanism, but what difference does it make, as long as, above all, you do not disappoint the stock exchange, you do not have to completely give up on the voters, either…. This having been said, one question arises: if governments see that their political margin for maneuver has been reduced to a hair’s breadth, if they are constantly being monitored “by the markets”, if they are obligated to open up their books for the least of their decisions, who is really in charge here?

In an essay entitled, “The Imaginary Left and the New Capitalism” (Editions B. Grasset, 1999), two journalists, G. Desportes and L. Mauduit, one from Libération, the other from Le Monde, have the merit, despite their whining about the “decline of politics” and “the disappearance of republican values”, of at least lifting one corner of the veil: “therefore, in every prediction that bears, in this game that is being played (in fact, the game is already over!), on the relationship between the markets and the public power, one decisive question is highlighted: Who is running the country? Is the government still in charge? Or, at the head of gigantic conglomerates, are these the real ‘private heads of state’, as the economist Jean-Paul Fitoussi puts it?” Here we have finally arrived at what is called, to employ the current jargon, “market democracy”, composed of financial magnates, bankers, major players in the stock market, speculators, CEOs of the multinationals and other “private heads of state”: this whole beautiful world discusses, considers, speculates in order to know what should or should not be done and then dictates to the “politicians” the direction that should be followed, even when the latter still pretend that they have a function. “The executive of the modern state is but a committee for managing the common affairs of the whole bourgeoisie,” as it says in the Communist Manifesto; with “market democracy”, capital, by assuming ever more firmly the reins of affairs in its hands, almost reaches the point of dispensing with its “managers”!

Such a situation gives rise to a chorus of lamentations. All kinds of well intentioned souls, imagining that things could be otherwise, get on their soapboxes to denounce this “impotence of the politicians”, their “capitulation to the moneyed powers” and their lack of “will”.

Meanwhile, if one casts a glance at the polls, they are hardly reassuring for the politicians. Like the Sofres poll whose results were published in Le Monde on November 18, 1999, in an article entitled: “The mistrust of the French population for politicians is still very strong”. One such poll, described as “alarming”, shows us that “rejection of politics is massive”, since 57% of those surveyed viewed politics with “mistrust”, 27% as “boring”, and 20% with “repugnance”, as opposed to only 26% who associated it with “hope”, 20% with “interest” and 7% with “respect”. This is obviously only a poll, but even so it appears there are many people who have a negative judgment of politics and politicians.

In consideration of these facts, as governments are increasingly reduced to playing the role of puppets on the stage, where the real actors are in the wings, whispering to the puppets their perennial “unique ideas”, while leaving to the puppets the role of playing to the gallery, the public is losing interest, as we have just seen, up to the point where such boredom is transformed into what the experts of political science call a “democratic deficit”. Let us see just what this is all about.

The “democratic deficit” or the decline of bourgeois democracy

This “deficit” assumes the form, first of all, of the rise of abstentionism. Even if in France the presidential elections still arouse some interest, one cannot say the same regarding legislative elections (we shall not speak of the European legislative elections, which are a resounding failure, with a rate of abstention, in June 1999, above 50%, while in Germany and England it reached the astronomical figures of 70% and 80%): whereas the average abstention rate between 1958 and 1978 was 20%, in the legislative elections of 1993 it was 34.7% of the registered voters, meaning that there were 12 million voters who stayed home or else cast null votes (1.4 million). In the most recent legislative elections of 1997, this upward trend was confirmed.

We have to make one thing clear, however. In France, the abstention rate is calculated on the basis of the total number of registered voters, but since the number of those eligible to vote but who are not registered is approximately 10% of the eligible voters, the real abstention rate approaches 50% if you add the null votes. One can thus evaluate the real share of the votes of the eligible voters obtained by the parties: so, the party that gets 25% of the votes (which under current conditions is a respectable figure), actually only represents no more than 12.5% of the eligible voters; this gives you an idea of just how representative the parties that win 10% or less of the votes are…. The Americans, more logically, calculate the abstention rate on the basis of the total number of those eligible to vote. But they do no better. While the abstention rate during the 1960s was approximately 40%, today it easily surpasses 50%. In other words, in “the world’s greatest democracy”, only a minority bothers to vote….

The abstention rates are only national averages, with all the classes mixed together. But if one examines abstentionism in terms of the various “socio-professional” categories, to use the language of the INSEE (National Institute of Economics and Statistics), it is clear that the poorer one is, the more likely one is to abstain from voting; generally, the abstention rate is higher among the blue collar workers and the lower paid white collar employees than among the middle class executives; and while we are talking about abstentionism among the working class, it is no less clear that it would be even higher considering the fact that, in 1995, 27% of the working class voters voted for Le Pen’s National Front, that is, they cast a kind of “populist” protest vote against the “politically correct” milieu.

Therefore, if one were to quantify the “democratic deficit” in terms of electoral abstentionism, one could say that the latter is now on the order of 50%. A poor showing for societies that are constantly crowing about their democracy to the whole world!

If we now turn to a consideration of the political parties, what do we find? First of all, we note that due to their paucity of followers they have been obliged to accept state funding, the P.“C.”F. included. But this is not even the most serious indictment: whether left or right, they are undergoing an “identity crisis”. Frankly, they no longer know for what purpose they exist, as all their points of reference have blurred. But why should this be surprising when everyone knows that real power lies elsewhere, among the “private heads of state” who, imposing their “unique ideas”, assume responsibility for making sure the parties are on the same wavelength, regardless of whether they are of the right or the left, although they still pretend to quarrel?

In this respect this “identity crisis” is even more pronounced for the parties that once had a significant popular base. Thus, in France, this crisis is having a very serious impact on the party of the Gaullist right (RPR), whose profession of faith was that it was “the people’s party”. If one takes into account this party’s support for the Europe of Maastricht and its conversion to liberalism, a party that, in other times, was instead a statist party with regard to economic questions, then its loss of support among the popular classes is not at all surprising. On the left, while the “Socialist” Party, the party of the middle classes, has not done too badly in terms of electoral support, the same thing cannot be said for the P.“C.”F., the former “party of the working class”, whose supporters have melted away and whose share of the national vote has plunged, falling from 20% in 1975 to approximately 8% today. So the “identity crisis” has reached its peak. Going from one “change” to another, the leader of this party, R. Hue, declared in an interview given to the Tribune of March 15, 1999 that, “the communists are not enemies of the market. We want, in a movement that embraces all of society, to place ourselves at the service of human needs and profit”. You don’t know whether you should laugh or cry! Meanwhile, if “communism” is now the “market” (whereas in other times, for this same party, it was “nationalization” and “the state”; those days are over now!), it should not be at all surprising that the working class has defected from that party, and whether they have taken refuge in abstentionism, or gone to vote for Le Pen, it could not be any worse than that kind of communist party!

Therefore, since the voters will not heed the call, the parties are in decline. However, one question arises: where can such a “democratic deficit” lead, which in fact amounts to a decline of bourgeois democracy?

It is not too bold to imagine that we are heading for a situation in which only the bourgeoisie, the upper middle classes and the other privileged layers will still have some reasons to vote for and identify with the parties. For them, this would still make sense, as they will still be in step with the system. Of course, we have not yet reached that point, but the trend is plain to see. Ultimately, we will have a democracy, ostensibly in fact although not legally, that will be increasingly more restricted, or an oligarchy, that is, a democracy reserved for the privileged ones of capitalism, somewhat similar to what happened during the era of Guizot and the “possibilités”, when suffrage was based on census qualifications and only the well-to-do could vote and stand for election. And if you are not satisfied with such a plutocratic order, instead of proclaiming like Guizot: “Get rich!”, once can say (this is what they are already saying now): “Be a success!”, which amounts to precisely the same thing.

This decline of bourgeois democracy that we are witnessing, and which has not yet revealed all of its contours, is inscribed within the framework of today’s capitalism that is at the end of its cycle: just as it is destroying the reality of an economy that is still supposed to be “national”, so too is it undermining the reality of a democracy that is still supposed to be “social”; but at the same time, the illusions that were bound to bourgeois democracy are dissipating, and an increasingly larger part of the masses are abandoning the ballot boxes, while the parties are discredited in the eyes of these same masses.

III

The Rise of the Subproletariat

Proletariat and subproletariat

In the first part of this “Investigation” we have noted the absolute diminution of the proletariat of industry and manufacture, a phenomenon that has been evident over the last 25 years in the highly developed capitalist countries. The bourgeois commentators, in their ideological confusionism, see this as a sign of the pure and simple disappearance of the working class. So where will profits come from, then? Not to worry, they will come from machines … as someone like J. Atali, says, for instance: “the machines are the new proletariat. Say goodbye to the working class.” While it is true that certain parts of the working class have disappeared, especially in mining, aerospace, steel and the automotive assembly line, capitalism is not just abolishing the proletariat; it is also creating a new layer of proletarians whose situation is much less comfortable. What does this mean?

The bourgeois economists and sociologists, in order to designate this new layer, speak of the “precarious”. While it is true that it is characterized by precariousness, we have to call things by their right name: it actually constitutes a sub-proletariat. We call this layer by this name because it occupies an intermediate position between the proletariat with full-time permanent jobs and that part of the proletariat that is almost totally excluded from the process of production (such as those individuals who are subsidized by the RMI), or, in any case, does not have much expectation of ever rejoining it, even if only sporadically, and which in reality no longer comprises part of the working class. This does not apply to the subproletarians, since they constitute a floating layer that is employed and then laid off by turns. This situates this layer below the proletariat that has stable full time jobs (that is, until the next wave of layoffs…), and slightly above the layer that is definitively excluded from the job market. Another characteristic of this subproletariat is that its situation as a floating layer is not temporary, but tends to become permanent: it does not have a job for life, but precariousness for life!

There is a connection between the proletariat and the subproletariat. The latter is recruited from among the proletarians who, after having been laid off, have not been able to find a job except on condition of accepting the new situation of precariousness that is offered to them; or they come from among the young workers from the classical working class who have not been able to find a real full time permanent job like their fathers; or, finally, they are recruited from among the proletariat of the tertiary sector and sometimes from the lower middle class, a fraction of which is cast out and falls into the proletariat.

The importance of the subproletariat and its situation

The communications media customarily provide monthly unemployment statistics and herald the good news—based on false statistical data—when they are declining. On the other hand, they ignore the scale of precarious labor or, in other terms, partial unemployment. To give an account of its importance we must therefore have recourse to much more specialized sources.

With respect to this question, Jeremy Rifkin’s book, The End of Work: The Decline of the Global Labor Force and the Dawn of the Post-Market Era (G.P. Putnam’s Sons, New York, 1995; a mystifying book as its title indicates and, in addition, naively reformist, but sometimes interesting due to the social data that it provides), is quite enlightening regarding the state of precarious labor in the United States. “[i]n August 1993 the federal government announced that nearly 1,230,000 jobs had been created in the United States in the first half of 1993. What they failed to say was that 728,000 of them—nearly 60 percent—were part-time, for the most part in low-wage service industries. In February 1993 alone, 90 percent of the 365,000 jobs created in the United States were part-time, and most of them went to people who were in search of full-time employment.” Rifkin cites the case of a former sheetmetal worker who, along with his wife, hold down four jobs between the two of them that altogether pay less than what he used to make from his old job alone, and when he was told that the Clinton administration was bragging about having created so many jobs, he responded with a forced smile: “Sure, we’ve got four of them. So what?” Rifkin points out that in the United States, “In 1992 temporary jobs accounted for two out of every three new private-sector jobs. Temporary, contract, and part-time workers now make up more than 25% of the U.S. workforce.” And he predicts that “35 percent of the U.S. workforce will be contingent workers by the year 2000”.

The emergence of this subproletariat of precarious workers has also occurred in the other capitalist countries. In France, the INSEE acknowledges that labor employed under contracts of indefinite duration (C.D.I.) no longer represents any more than 60% of the total wage labor force. In 1996, 9% of jobs paying wages were precarious (as opposed to 2.8% in 1984). Today, 9 out of every 10 jobs created are part-time jobs. Even public sector enterprises have their share of precarious workers. Thus, in the postal service, “contingent” workers employed by private companies under contracts of determinate duration (C.D.D.) numbered 22,000 (Le Monde, November 13, 1996). In England, approximately 25% of jobs are precarious. The Netherlands, which had been praised for having reduced its unemployment rate from 12% in 1983 to 7% in 1996, saw the proportion of part-time jobs as a share of the total number of jobs rise to 33%. (Le Monde, October 29, 1996). In Spain, 95% of the millions of contracts signed every year are temporary (Le Monde, October 23, 1997).

What do we mean by precarious jobs? Essentially, contracts of determinate duration, valid for several months or a few weeks (or a few days, or even a few hours) and which, once they come to an end, compel the worker to sign up for unemployment insurance or else to “get by” as well as he can, with “odd jobs”, if he can find them, or off-the-books work, until he can once again get another “assignment”.

What Rifkin says about this topic is quite interesting. In the United States, he tells us, “[p]art-time temporary workers earn on average 20 to 40 percent less than full-time workers doing comparable work. According to the Department of Labor, part-time workers averaged $4.42 per hour in 1987 compared to $7.43 an hour for full-time workers. While 88 percent of full-time workers received health coverage through their employers, less than 25 percent of the temporary workforce was covered either by temp agencies or the companies they were leased out to. Similarly, while 48.5 percent of full-time workers were covered by employee pension plans, only 16.3 percent of part-time workers received pension benefits”. In other words, for the same work, lower wages and fewer benefits: the subproletariat must undoubtedly feel that it forms part of an inferior, disposable labor force. Thus, at the Citroën plant in Aulnay-sous-Bois, in order to distinguish the different kinds of employees, the temporary workers wear a green shirt so they are not confused with the permanent employees.

In order to be more competitive and profitable, businesses have to reduce “labor costs” (this means: reduce real wages) and in order to realize this goal they do not hesitate to “externalize” part of their production by shifting it to small and medium-sized enterprises, which in turn ruthlessly exploit precarious workers and pay them very low wages. As Rifkin writes, “Many of the outsource suppliers are smaller companies paying low wages and providing few benefits to their workers. Outsourcing … has become increasingly popular in the United States and Europe…. Chrysler procures more than 70 percent of the value of its final products from outside suppliers. According to a study conducted by Paine Webber, upwards of 18 percent of the workforce in the steel industry is now made up of employees working for subcontractors”. Rifkin cites the case of a pipefitter at U.S. Steel who made 13 dollars an hour and who, after being laid off, performed the same work for his old employer, but now in the capacity of a subcontractor, at 5 dollars an hour. This is what is called “external flexibility”, which allows for a substantial reduction in wage levels. This is why, when they tell us that the small and medium-sized enterprises are the most important “gold mine of jobs”, we have to believe it. But what kind of jobs are we talking about? We just got a glimpse of the reality.

More than just an industrial reserve army

What does the emergence of such a layer of working poor, as the Americans call them—precarious, low-paid, and despised workers with no benefits—mean?

It is true that they comprise an “industrial reserve army” that capital can take advantage of whenever it needs to do so. “Just-in-Time” production and “zero inventory” management require a very flexible workforce, always available and easily dismissed.

This answer, however, is not good enough. Since the emergence of this layer of the workforce at the beginning of the 1980s, it has constantly increased in number and today we have reached the point where businesses (although we are told that “growth is back”) almost never employ full-time, permanent wage workers (except executives, and even then not as much as before). Some research institutes even foresee the complete disappearance of C.D.I.s (contracts of indefinite duration). But we shall not take these predictions seriously, as they are often confused and unfounded. For now, most jobs are still based on C.D.I.s. This does not mean, however, that from now on it will not be harder to find a permanent job. What does this mean? It means that the wage labor system, as a specific mode of capitalist exploitation, is dying. To put it another way, having reached the end of its cycle, capitalism is incapable (similar to the situation during its beginnings) of producing and reproducing the proletariat except in an intermittent and very partial way, and the precarious workers of every variety are the social expression of this fact: they have one foot in the wage labor force, which proves that they are still a proletariat, and they have the other foot outside the wage labor force, which proves they are no longer a proletariat. These phenomena have invariably been highlighted by commentators of every stripe, such as Rifkin, but, exaggerating its significance in a totally disproportionate manner, they interpret it as the “end of work”, and therefore, the “end of the proletariat”, but not the end of capitalism, obviously!

IV

The Decline of the Middle Classes

Middle classes—or are they?

We have to break with the almost mythical image of the “middle classes” that is constantly being propagated everywhere today. The middle classes, within the framework of highly developed capitalism, are salaried employees and by the term “middle classes” we must essentially understand the executives and managerial staff of public and private enterprises, that is, the personnel who are not connected with the tasks of execution (like the blue collar workers and lower level employees) but with conceptualization, research, management, and direction.

With the vast development of the productive forces and the resulting modernization of enterprises, the perfection of machinery and production techniques, the Scientific Organization of Labor (SOL), and the modern management of commerce, the number of executives and managers has increased considerably. In 1975, France had 1,270,000 high level executives and 2,760,000 mid-level executives and managers. In addition to the school teachers (approximately 1 million) one may also include in the middle classes the so-called intermediate professions: technicians, administrators, foremen, social workers, etc.

This non-working class labor force is recruited from all classes, including the working class, albeit to a lesser extent, however. The possession of a degree (and if possible, a graduate degree) is the indispensable precondition for rising into the salaried middle classes. From then on, with a degree in one’s pocket, one can have access to the good life, with greater career expectations, higher salaries, and better working conditions than those obtained by the blue collar workers in industry and the low level employees in the tertiary sector. Thus, ensconced in this aristocracy of salaried labor, one finds the layer of government officials, major and minor, but all of whom have the privilege of having a guaranteed job for life. And in private enterprise, you have the high level executives who are paid very high salaries, and possess stocks and stock options, which enables one to speak, with respect to this category, of the existence of bourgeois salaried workers.

Because of their growth, their educational level and also their privileged social situation, the modern middle classes have played a very major role in the cultural life of the highly developed capitalist societies. As their trademark image, they are allowed to “set the standards of taste”. That is why they are the ones you always see on stage in films, advertising and the communications media. An entire category of the press, from Le Figaro Magazine to Le Nouvel Observateur, and from Le Monde to Libération, is devoted to them. Generally, their lifestyles, their tastes, their preoccupations, and their worldviews are incessantly exhibited. It has reached the point that the petty bourgeois dream of many workers is to be like them and they even identify with them. Thus, according to a poll conducted among workers, 58% of them believe they belong to the middle class (Le Monde, March 26, 1997). A poll of this kind, like all polls, has to be taken with a grain of salt, but it does indicate the impact that the new middle classes can have on people’s attitudes.

The status attained by the middle classes and the tendency displayed by the blue collar workers and the lower level white collar employees to identify with them, have led the sociologists to speak of a “medianization” of society: we are no longer living in a class society, but in a “wage society” in which the immense majority lives in more or less similar situations. But with the excluded and the subproletariat constantly increasing in numbers, we have to take a closer look. As for the workers who think they are members of the middle class, this expresses more of an aspiration than a reality. In fact, the middle classes, even though they play a large role in modern capitalist society and exercise a great deal of influence on many people, form a world apart. They do not consume the same products and they do not frequent the same places of entertainment and leisure, depending on whether one is an executive or a worker. In any event, the middle classes have a distinct feeling of belonging to the elite of the workers. They are the privileged members of the working population and they know it. This is why they constitute the strongest social pillar of the capitalist system, and there can be no doubt concerning their alliance with the bourgeois class; and whether they call themselves right wing or left wing makes no difference at all.

There is no longer room for everyone on “the social elevator”

But we must point out that even for the middle classes the sky is getting darker. “Middle Classes, Anxious Classes”, is the headline of the “Economy” section of Le Monde, December 23, 1997. And why? The newspaper tells us why: “Education no longer guarantees social mobility”, or to put it another way, it no longer automatically guarantees access to the golden world of the executives. Let us see just what is the cause of this anxiety.

In 1968 there were 500,000 college students in France. At the beginning of the 1990s, there were 2,000,000. As you can see, the increase has been spectacular. How can it be explained?

After 1975 capitalism had gone all out in an attempt to take advantage of all the “new technologies”, modernizing and automating its production and management apparatus in every possible way. There arose, then, a large demand for scientific, technical and commercial skilled labor. In order to satisfy this demand the number of technical schools and universities had to be increased, which would be responsible for training the new executives that were needed by “high tech” capitalism. Therefore, the number of college students rose. But in parallel with this technological advance, capitalism also began to lay off workers in large numbers and this led to growing unemployment. All of a sudden, fear of unemployment led many ordinary families to try to make sure that their eldest sons would pursue a higher education (and they were prepared to make sacrifices for this) so that they would escape unemployment. The number of college students grew even more. That was when a frenzied competition for degrees began. We have come a long way from May ’68, when students tried to start a “revolution”. From then on, in the universities you did not “protest”, you “crammed”, since you had to pursue, regardless of the cost, the much-desired degree that would allow you to become a member of the middle class and thus escape unemployment. At least that is what they thought.

But what happened then is what always happens in a capitalist regime: when the supply exceeds the demand, there is a surplus and part of the supply does not find a buyer, in this case a certain number of applicants for jobs as executives, for which the students sought to apply once they got their degrees. “If the higher categories seem to have maintained their privileges, for the others the university degree no longer confers an automatic right to a job”, proclaims the Le Monde article mentioned above. And this is the problem. Claude Allègre, the recently appointed Minister of Education, saw the end coming in 1996 when he wrote: “We have to accept the consequences: a university degree no longer automatically confers the right to a high-paying job. It is a higher education without any guarantee of a high-level job! For the middle classes, which are the real beneficiaries of the demographic opening, school no longer guarantees upward social mobility”. There is the rub! And he concludes by saying that not facing up to this reality inspires “false hopes”. Actually, nobody was “deceived”: back when the demand exceeded the supply this excess was noted, and the universities, like any other capitalist commodity, only obeyed the laws of the market.

This is why a situation arose in which the technical schools were capable of producing 80% of the bachelor degrees and the universities mass produced degrees after 2, 3 or 4 years of study, and these institutions were transformed into partially uncontrolled machines, and once they graduated, many students did not find jobs that matched their high expectations, and the “social elevator” that was supposed to bring them to the penthouse, on the wages scale, had no room for everyone. The only beneficial effect of this process was that, by thus prolonging the school years of the younger generations, the unemployment figures for young people between the ages of 18 and 25 were reduced!

Lebaube, in Work: Always Less of It or of a Different Kind (Le travail. Toujours moins ou autrement, Le Monde Éditions, 1997), perfectly summarizes the situation when he writes: “Within 5 or 7 years, the productive system of national education will be in a position to ‘graduate’ between 500,000 and 700,000 young people annually with degrees at a level that is equal to or superior to a bachelor’s degree with three years of study, the same number of years of study that would have allowed, only a little while ago, one to get a job as an executive. We must take into account the fact that, according to the statistics of APEC (Association for Skilled Employment), during the same period, businesses will recruit on the order of 120,000 young executives per year (….) The job deficit for skilled graduates, has every chance of overwhelming us in relation to the future graduating classes”.

From then on, with “the social elevator” overcrowded, the young people of the middle classes, college students and, above all, students at the technical institutes, will not take long to express their discontent. Since 1986 they have been engaging in massive protests. Their anger reached a peak in 1994 when the government proposed instituting the Contract for Professional Work Placement (CIP) for young people, paid less than the SMIC (Minimum Interprofessional Wage), even for those with two years in the university. This proved to be a major provocation for the young people who had ambitions, among other things, of “having a career”. The government replied that it was better than going on unemployment. That’s where we are now. After having been seduced with the prospect of executive jobs, all that the government could propose for them were the lowest paying jobs; jobs that were good enough for the young proletarians, but not for those who wanted jobs as executives and who had no scruples about becoming the “guard dogs of the working class”, as the students of May ’68 said….

The inevitable relapse

Today, despite the euphoria of the 1980s, we are suffering from malaise. The degree is no longer the “open, sesame”. One part of the graduates was demoted, declassed, and obliged to accept an ordinary job with a two-year degree. It is frustrating, but that is how it is. Thus, there are young people who enter their working careers overqualified for the jobs they are offered, and whose acceptance of these positions closes them off to less qualified young people, jobs which the latter would have been quite happy to accept, but now they are shown the door, which swells the ranks of precariousness and exclusion. At the rate things are going now, soon it will be necessary to have at least a bachelor’s degree to be a street sweeper….

Others descend into the working class. A. Lebaube points out that during the strikes at SNECMA in 1987 and at Alsthom in Belfort in 1995, it was often young people with two-year degrees who were at the head of the movements. “Basically,” he writes, “they had nothing to lose, they know their professional careers are over and their personal aspirations stolen from them. Despite their degrees, they were employed as skilled workers, without any hope of ever being anything else, or else they were working as technicians, in the most fortunate cases as technical supervisors, having already reached in just a few years the highest level possible.” But others were not even that lucky: one-fourth of the new beneficiaries of the RMI subsidy had at least a bachelor’s degree, the newspaper Les Échos informs us (May 15, 1997).

And while young people are subjected to a merciless selection process in order to be able to have access to the privileged circle of executives, older people are laid off as soon as they reach the age of 50, or even sooner. Under these conditions, finding a job as an executive at that age is very difficult for these older workers.

Generally speaking, the situation of the executives is not what it used to be. If the “dynamic young” workers get a good job, capital demands from them in return their constant presence at work. For them, at least in the private sector, there is no 35-hour week, but more often 50 hours or more. Even during their vacations they can get phone calls from their managers. In the public sector, the working conditions of some teachers in the “problem” schools in bad neighborhoods have deteriorated significantly: insults, threats, and occasionally violent assaults from the students. In short, a large part of the middle classes view life much less optimistically. Thus, according to one survey, more than one out of four executives believes that in 2007 he will belong to the ranks of the “common” and “disadvantaged people” (Le Monde, March 26, 1997).

***

The golden age of the new middle classes has passed. After having grown and made so much progress, they have begun to undergo a reflux that is far from having ended, if one takes into consideration the number of job seekers who are graduating from the universities and the number of job openings that are available to them. As a result of its technological advances since the 1970s, capitalism has been able to foment the illusion of a society in which everyone, as long as they get a degree, can become a “new look” petty bourgeoisie, paid a wage, but forming part of the highest layer of the wage labor force. But from now on, this technological advance has reached a stage beyond which the extraction of surplus value will be impossible due to the almost universal automation of production. As a result, the need for executives has also reached its limits and capital can only reject those that exceed the demands of the labor market, reducing them to the condition of ordinary employees earning an ordinary wage, or blue-collar workers, when their proletarianization does not lead to pure and simple exclusion from the workforce. This is yet another sign of the end of capitalism’s cycle.

V

Ideological Decline

The need for a collective belief system

Every class society needs a collective belief system that cements all the classes together and thus transcends them. We emphasize that it is a system of “belief”: it has nothing to do with any theory, science or philosophy; it is rather an idea, a political faith that compels the support of the masses and which can be defined as an ideology.

Such a system of belief is absolutely indispensable for a society plagued by conflicts, tensions and clashes between the classes that reveal that the interests of the latter are not identical to each other. To prevent all this from breaking out into violent conflicts and class struggles that would destabilize society, a ruling ideology has to be imposed for the purpose of incorporating all the classes behind it.

In the framework of capitalism, the task of elaborating such an ideology quite naturally falls to the bourgeoisie, that is, to the class that possesses the “material”, and therefore, the “intellectual” means of production. (Marx-Engels, quoted above, from The German Ideology.) In other words, the bourgeoisie must become the class that assumes ideological leadership over society and is not content with dedicating itself to its economic and commercial occupations. At this level, it is necessary for it to assume its responsibilities, and if it does not, this reveals that it is either not yet mature enough to lead society or else that it has become an exhausted and declining class.

For the ruling class upon which this responsibility for the production of ideology falls, the purpose of the operation is to successfully present its particular interest as if it were the general interest of society. Thus, “the state”, or rather the “nation”, is reputed to embody and defend this “general interest”.

Such an ideology must furthermore be able to obtain enough support from society, that is, it must create a system of belief that is capable of engendering “zeal” or “enthusiasm”, like “patriotism” upon the outbreak of war, or “republicanism” during a serious social crisis.

Historically, the ruling ideology assumed various forms, depending on the country, and was imposed by means of a process of greater or lesser complexity.

Thus, in Germany, for a long time—right up to 1918—the politically immature bourgeoisie relinquished its ideological role to the landowning aristocracy and its military caste which, in turn, created a super-nationalist, arrogant and aggressive ideology.

In England the bourgeoisie reached a compromise with the old landed aristocracy; this led to a hybrid ideology, a kind of national liberal ideology tinted with monarchism.

In France the ideology of the ruling bourgeoisie was not fully imposed until after 1871. This was the nation conflated with the republic. Prior to this date the idea of the nation was not a bourgeois idea, but a revolutionary one: until the Commune of 1871 the fatherland was defended by the extreme revolutionaries of the Blanquist type, or other kinds, since for them France was “the fatherland of the revolution”, the country that had first carried out the Revolution in 1789-1794, and had begun to do so again in 1830, 1848 and 1871, thus showing all the other countries the road they should follow. This revolutionary nationalism was still evoked in support of the Commune of Paris when the latter, even though wrapped in the red flag, decreed that the “fatherland was in danger”; with this proclamation it showed the bourgeoisie, after the shameful capitulation of Sedan (September 2, 1870), that it had betrayed the nation and that from then on the latter no longer belonged to it, it would pass into the hands of the “working people”. After 1871, everything changed, and the bourgeoisie reclaimed for its own the idea of the nation by successfully imposing the belief that it belonged to all the classes. It proved to be more successful in this respect than it had expected when in 1914 the people, that is, all the classes, happily marched off to “defend the fatherland” and consented for 4 years to make unprecedented sacrifices for this cause. Having succeeded in this, the bourgeoisie managed to fuse all the classes, “to rally all the French people”, to speak in their terms. Socialism, which presented itself as internationalist, then experienced a cruel defeat. Later, Gaullism, between 1945 and 1968 (assisted by the French Stalinist party, which presented itself as “the heir” of the revolutionary tradition of 1789-1871 and which thus combined the red flag with the tricolor), took up the nationalist torch, although “in an attenuated and somewhat grandiloquent way”.

But today, what remains of the ruling bourgeois ideology?

The downfall of political beliefs

If one examines the world of the so-called advanced capitalist societies, one fact is particularly striking today: in this world, there are no collective passions, or great political ideals, or systems of convictions capable of rousing the support of the masses, of stimulating enthusiasm and instilling hope. From the ideological point of view it is a somber and bleak world that has arisen. Only sporting events, on occasion, can provoke collective outbursts but they quickly subside, since they are nothing but spectacles.

We observe that political life, and the debates to which it gives rise, now only take place on the television screen and that the modern masses therefore no longer have to go anywhere and gather together in order to listen to their political leaders, because they have them right before them while they are sitting in front of their televisions. Politicians of all stripes know this. That is why they are always on TV expressing their opinions, responding to the questions of the journalists and other specialized “moderators”. What remains to be investigated is the question of whether or not many people are really interested in these broadcasts. For this purpose we do not even have to consult the ratings, all we need to do is to see when these programs are broadcast in order to immediately know that, if they are broadcast late at night this is because the program in question is not likely to be popular, as the public prefers entertainment or sports. In short, the politics-spectacle on television is no longer a box office hit.

One conclusion is in order: we are witnessing an almost universal de-politicization and de-ideologization. The modern masses have become desensitized to everything that refers to the “res publica” and to “the clash of ideas”. All such things bore them profoundly and they prefer to be entertained rather than listen to politicians, for whom, in any case, they only have the lowest regard. Even during the celebrated “bar-room” discussions they talk about any other topic besides politics.

But we shall take our investigation one step further. If the masses thus desert politics, this amounts to saying that they are no longer influenced by it, and that it is no longer capable of “making them dream” of a “bright future” and “sacred causes”. And this is what is most revealing. Such a state of affairs is first of all a challenge to the bourgeois ideology because the latter is the ruling ideology in society; it has become incapable of arousing the active support of the masses, since it has ceased to excite them; and in fact, as we saw above, the bourgeois ideas of “fatherland”, “republic” and “democracy” are already in free fall.

We must nonetheless make some distinctions. The illusions with regard to the ruling bourgeois ideas have fallen, not because the masses have become aware of their artificial character and have dealt them a setback by rejecting them; if this were the case, there would have been a politicization of people’s attitudes; instead, they have collapsed because capitalism, having entered the final stage of its cycle, has made their survival impossible: thus, the idea of the nation, condemned along with this capitalism to an irreversible decline, and the idea of democracy, which is from now on short-circuited by “market democracy”. In other words, capitalism, lacking an ideology, has ended up destroying all ideologies, including that of the bourgeoisie.

Ideological prostration

Of course, the bourgeoisie is still trying to deceive people, and trying to manipulate consciousness. But what will now become of its ideology? We shall see that it has lost all its consistency.

As an illustration, let us take the idea of “human rights”, which has been seized upon by the media and the politicians of every stripe and concerning which they ceaselessly harp at every opportunity. What does this flood of words about human rights actually mean? They are actually and fundamentally the opposite of a collective ideology or belief: they derive from the egotistical and individualist Declaration of the Rights of Man, elaborated by the bourgeoisie of 1789, which Marx criticized in “The Jewish Question”; what they value is the private man, the man of private property. The bourgeoisie of the 19th century, by becoming the class that assumed the ideological leadership of society, was very careful to put the damper on this bourgeois-liberal-individualist Declaration. It needed something else to “rally all the French people”: the Nation, the Republic … that is, political subjects that evoked ideas of community, the collective interest. That is why there is still a faction of the bourgeoisie—very much in the minority—that, rejecting “human rights”, wants to return, without being able to do so, and for good reasons, to the Republic of Gambetta and Clemenceau, to the secular school of Jules Ferry and, of course, to the Nation, “one and indivisible”….

If the bourgeoisie has had to resort to the weapon of “human rights”, this is simply because it no longer possesses a collective system of beliefs; furthermore, because it has even ceased to understand the need for such a system. Proof of this is offered by the enthusiasm with which, not so long ago, it fought against the old ideologies that were current during the 20th century, which it referred to as “totalitarianisms” (fascism, communism—which it identified with Stalinism, but that does not matter here); “totalitarianisms” with which, we may add, it flirted in the past, having sympathized with Hitlerism (“Hitler is better than the Popular Front”, the French bourgeoisie was loudly proclaiming in 1936), and having shamelessly formed an alliance with Stalinism, like the American and English bourgeoisie in the Second World War in 1941; which shows how inconsistent and trivial that variety of critique directed at “totalitarianism” really is; but for today’s bourgeoisie it does not matter, the deafening and insistent condemnation of fascism and “communism” has only one purpose: to discover a pacifying justification for the absence of any collective belief, serving as a comfortable line of demarcation between it and the “totalitarianisms” in question.

Currently, the ruling bourgeois ideology has become so inconsistent that it is nothing but a moralizing litany: a slurry of flabby, “tolerant” ideas, of feel-good issues (“humanitarian causes”) that are very “moving”, but which mobilize no one politically. It is the zero point of thought all along the line, or, if one prefers, it is the “politically correct”.

The only arena in which the bourgeoisie does not just fool around is the economy. But there it operates without any ideology at all. It only obeys the laws of capital, the requirements of the market, the harsh necessity of profitability, and the most humanistic employer will not hesitate to implacably lay off workers if necessary, while the multinationals have no scruples in using the forced labor of children. Here we have such demonstrations of resolve that they become blind to the need to uphold and secure their system of rule. Hence, one may read the following in the November 12, 1999 issue of Le Monde, from the pen of one of its intellectuals, R. Redeker, professor of philosophy and member of the editorial committee of the journal, Les Temps Modernes:

“‘How can one live without ever facing the unknown?’, asked René Char. We no longer have to face ‘the unknown’. All perspectives have been closed, reduced to the constant repetition of capitalism. The death of communism is accompanied by a shrinking of the human soul: there is no longer a horizon for societies. This results in a state of mourning, a glaciation of hope: man is condemned to remain as he is (history will not give birth to the new man), societies are condemned to capitalism, to private property, to the ‘privatization of the individual’ (to employ the term of Castoriadis). Contemporary man is cold: the death of communism leaves him isolated before the absence of a future.”

What is remarkable about this passage is not the despair that overwhelms the author as he contemplates the absence of any alternative to capitalism in the wake of what he calls “the death of communism” (despair over the death of Stalinism? Spare us from this death of a communism that never existed!); what is remarkable is the dread that overwhelms him when he thinks of the possibility that capitalism is eternal, and humanity is condemned for the rest of its days to suffer the impact of such a system. Here we have the last illusion of the bourgeoisie, however much Le Temps Modernes may affect to be of the left. Today it no longer has much ideological belief about anything; it even admits, as we have just seen, that its system is not very pleasing to the spirit, yet it adds, it is indestructible and invincible. This it continues to believe without any hesitation. Which amounts to saying that it imagines that capitalism can last indefinitely without a collective belief system that could give meaning to existence and therefore, it can pass the tests of time and overcome all obstacles. Actually, this is pure illusion, since it is precisely this factor that is lacking in today’s capitalist societies. It is true of course that capitalism is immensely sad and mournful if it is not accompanied by a strong ideology capable of sublimating it in the “Fatherland”, the “Republic” or other ideals. When it descends into a “1929-type” crisis, what will happen then? Today’s capitalist societies, in view of their total absence of any ideological reason to exist, will collapse and go under at the first blow, and there will be a massive stampede for the lifeboats, and the “elites” will be the first ones to set the example. For the rest of us, it will be like what we recently saw in the East: when an economic blockade led, as we saw in the former so-called communist system, to the establishment of what was believed to be an internally indestructible regime due to its “totalitarianism”, it collapsed in an instant, once the ideological tie to pseudo-communism had been cut, that is, the prevailing system of belief which had upheld the system until that point. Such an ideological collapse is also taking place in the western capitalist societies and, once the crisis breaks out, we will see that everything that sustained it ideologically was hanging by a thread. A class society cannot exist by congratulating itself about the “end of ideology” without suffering the consequences.

VI

From “Moral Order” to “Moral Disorder”

The real bourgeois values

The French bourgeoisie had played the game well when at the beginning of the Third Republic it firmly assumed power: it claimed that it was the heir of the ideas of the French Revolution—Liberty, Equality, Fraternity—in order to transform them into the symbols of its rule, symbols that it caused to be inscribed on the facades of all public buildings. This allowed it to rally all the classes around it, getting each class, in its own way, to be interested in it and to interpret these ideas according to its needs. In a country like France, which had been convulsed by especially violent class struggles (June 1848, the Commune of 1871), this was a good way to reconcile all the French people. With the exception of the “reactionary clerical” faction, which never accepted the French Revolution and which still made this apparent through its behavior during the Dreyfus Affair, the operation was crowned with success: the Republic had opened its arms to all its children, regardless of their social conditions. In this way the rule of the French bourgeoisie was conflated with a progressive rule that was associated with dignified and respectable values.

When in 1940 the same French bourgeoisie unforgettably dropped its pants and bent over almost as one man in its “collaboration” with Nazi Germany, and succumbed to the allure of fascist ideology, it removed its mask and said: “Work—Family—Fatherland”. And at the same time it vilified and rejected the famous triptych, Liberty—Equality—Fraternity, which was, according to this same bourgeoisie, “the cause of the defeat”.

From that point on the following question was posed: which of the two bourgeoisies, the one from 1880 or the one from 1940 (it was in fact the same bourgeoisie) expressed the truth about the real nature of bourgeois values? Obviously, it was the bourgeoisie of 1940! In reality, the values proclaimed by the Pétain regime were always the operative values. Of course, after 1945 the bourgeoisie returned to the fetishistic Republican values, but this was just another one of those famous “French exceptions” by which the bourgeoisie of that country had taken such delight in distinguishing itself. Nowhere else does one find a trace of this profession of faith. Generally, one refrains from any such declarations, it is better that way….

So, let us take a look at those values that the bourgeoisie, once upon a time, boldly proclaimed.

Work. Actually, how can it not be glorified, given the existing economic system, which makes the exploitation of labor power the source of the valorization of capital and its incessantly renewed accumulation. On the other hand, more generally, bourgeois society can be defined in its entirety as a civilization of labor, the largest that has ever existed, bringing forth unsuspected results from human activity. The socialist P. LaFargue was not mistaken when he wrote his famous pamphlet, provocatively entitled, The Right to Be Lazy, in 1880. This essay was a fly in the ointment of the bourgeois moral order that constantly praised the “honest, hard working” worker, who did his duty without complaining, which he performed without even having to pay him an old age pension, so much had his existence been abbreviated by working him to death….

Family. After the worker had performed his day’s work, it was quite natural for him to find a “comfortable nest” together with his wife and children, and thus he could reconstitute somewhat his labor power for the next day. This is why the family was sacred. Thanks to the family the worker escaped that site of dissolution that was the tavern. And in order for the family to be based on firm foundations, it had to be consecrated by way of the bonds of matrimony thus putting an end to that mania for just “living together”, with couples cohabiting and splitting up as they pleased.

Fatherland. As we already pointed out, the Fatherland was worshipped, exalted, and sublimated, and it was the job of the “patriotic teachers of the Republic” to mould the schoolchildren from their most tender years. Everyone had to rally around the Fatherland, there had to be a national front without any gaps. This too, could not be more logical. In an era when capitalism was not yet “globalized”, it was the national capitalism that in the economic order of things was to be honored: it was from within the borders of the nation that the essential surplus value was extracted (“relocations” had not yet made their appearance…), even though the colonial empire constituted an additional source….

Work—Family—Fatherland, for the goals that Pétain’s regime had established, this corresponded quite well to the requirements of capital. If one also adds religion (“religion is good for the people”, declared the bourgeois Voltaire), one thus has a Moral Order capable of guaranteeing social peace in the city; and it will certainly take more than a few anarchists and anarchosyndicalists, bomb-throwers, strikers and anti-militarists, to seriously disturb such an Order….

Greatness and decline

What remains of that Order? We shall review its various components and note the changes that have taken place.

Work. With “high technology” capitalism, we have been informed that it has become “inessential”. Some, like Rifkin, even claim that, from now on, what we are witnessing is “the end of work”. Yet today, the economic horror (V. Forrester) is no longer the exploitation of man by man, but man’s exclusion from work, now that machines are “the new proletarians”, while we “say goodbye to the working class” (J. Atali). Work is “inessential”? Has it come to an “end”? We no longer need to exploit human labor? This is not at all the case! If it were so, the valorization of capital would be impossible and capitalism would cease to exist! But we shall not engage in an explanation of why these “ultra-modernist” interpretations are false. With respect to this matter we refer the reader to Part One of our “Investigation”. We shall simply state that, due to the last stage of capitalism’s development, which has the effect of eliminating labor, at the same time that it still needs labor to revalorize capital (this is the contradiction of capital), the old moralistic bourgeois discourse concerning the virtues of work has been dealt a hard blow, and is not far from falling by the wayside.

Family. This, too, is on its last legs. In reality, more than one-third of marriages result in divorce a short time later; paternal authority over children has been severely compromised; one-parent families are becoming more and more common; as for the sacred character of the marriage between man and women, one can only laugh when with the PACS (Civil Agreement of Cohabitation) we have reached the point where homosexuals can “get married” and perhaps even adopt children….

Fatherland. To evoke it has become “somewhat archaic”, when it used to be “the place of the sacred soil” and to die for it was “the most beautiful fate”…. Here, too, the collapse of this value is spectacular, and one can count on the fingers of one hand those who have gone to the Elysian Fields wrapped in the tricolor the night after the French team won the World Cup, ready to risk their skin for the fatherland.

In short, it is easy to state: the edifice that constituted the bourgeois Moral Order has cracks all over its surface and is in full decline. In this regard it is quite curious to see some leftists and anarchists who continue to vilify that Order as if it was still vigorous, as if we were in the era of Jules Ferry, Gambetta and Clemenceau. Obviously, these people have cobwebs in their eyes and have to get some new eyeglasses in order to become aware of the times.

There are, of course, some “fundamentalists”, and a few “leagues for morality and virtue” that are offended by such a “loss of values” and dream of a “conservative revolution” that would reestablish the Moral Order in its full power. They have only exhausted themselves in dubious rearguard struggles without anything to show for it. What these people have not understood is that if the Moral Order has been weakened, this was not due, as they believe, to a mysterious perversity in the human soul that surrenders to the demons of “sin”, but to the new conditions that have arisen. Their Order was constructed on the foundations of a capitalism in full ascent, which had a whole horizon of development before it. It is true that it was criticized for its bourgeois character by revolutionaries. In economic crises and wars it was challenged by various currents (such as the Surrealists). But for good or for ill, it survived these attacks. Its ideological superstructure corresponded well enough to the economic structure of capitalism. Now that capitalism is nearing its end, the capitalism that is characteristic of our era, this Order is proving to be increasingly ill-adjusted to the latter and reveals its obsolete character. Indeed, why celebrate work if work has not only lost any attraction for the proletarians (which has been the case for a long time), but now that it has also become a rare commodity for millions of individuals who have been excluded from it, or else condemned to getting by on odd jobs, part-time work, garbage picking and other forms of precarious labor? What can paternal authority mean to young people whose parents are submerged in chronic unemployment? What can Fatherland possibly mean if the bourgeoisie themselves are no longer very certain of the reality of their nation? Necessarily, the old Moral Order ended up losing all consistency and at the same time all the points of reference that constituted it have faded away in the minds of the people to the point that they are finally just ignored. And this all the more so insofar as the institutions that are supposed to recall its norms have ceased to function as such: there is no longer an “ethics course” as in the old days of the secular and republican schools….

Moral disorder

With this weakening of the old bourgeois moral order, there is, however, a price to pay. Every class society needs a duly established moral code in order to determine what is “good” and what is “bad” for it. If this order decomposes, and dissolves in peoples’ minds, as long as no other society arises, or at least as long as no revolutionary movement arises that is the bearer of new values, this will necessarily result in a moral disorder that will take the form of all kinds of more or less dangerous behaviors. This can be verified today among the young generation, which is much more affected by this than the older generations, since the latter have preserved some points of reference.

Our intention here is not to engage in a journalistic sociological exposé on what is called “urban violence” and thus say what everyone already knows: drug use, violence in sports stadiums, in colleges, aggressive behavior towards teachers, vandalism of public buildings, burning cars, aggression in the streets and, sometimes, murders without any apparent reasons, such are the most visible manifestations of the moral disorder that has become commonplace. Obviously, we shall be told that none of this is new. At the beginning of the 20th century there were “apaches” and homeless youths who infested the abandoned “pillboxes” on the outskirts of Paris, and during the late 1950s we had “hooligans”. Today’s youth gangs of the outskirts of the cities would therefore be just so many more chapters in this ongoing history. So, all is well! There is nothing new under the sun! In brief, it is never music to the ears of the defenders of the system to hear it said that the latter, in its putrescence, is giving way to a moral degeneration that is taking the form of a deterioration of behavior and blind violence. In fact, things have reached such a point that we even miss the old bourgeois morality that at least told individuals what they had to believe and not believe, to do and not to do. It is not another world, but with the situation that has been created, a worse one that is being established; the disruption and the absence of points of reference are such that anything can happen.

Since, in any event, it is hard to ignore what is happening by continuously downplaying its seriousness, all that we have is repression. But once you have imprisoned—if possible—the most dangerous “gangbangers” and attempted to enter into “dialogue” with the others thanks to “local policing” and “street entertainers and clowns” (?!), the moral disorder will still not have been driven out of people’s minds, for the good and simple reason that, the old moral order having broken down, for the moment there is nothing to replace it.

This is where the “most fashionable” bourgeoisie intervene, who, with their intellectuals, their “engaged” artists and other stars of the Cohn-Bendit variety, think they can be the bearers of a “new ethics”, one that is more flexible and not so uptight, one that would supersede the old bourgeois moral order. Thus, to give an example, instead of prohibiting drug use, they advocate the legalization of “soft drugs” like hashish and marijuana. This is called the “liberal-libertarian” attitude, which former minister Jack Lang has made his specialty, as he is always present whenever the television cameras are covering some “love parade” [in English in original—translator’s note] or a march staged by some raging exhibitionists. Legalizing soft drugs (and, since this will not be sufficient, the “hard” drugs will have to legalized, too, sooner or later), such a solution in fact amounts to the legalization of the whole world of moral disorder, without responding to the basic question: why do people feel the need to drug themselves? But such a question cannot, obviously, be asked by such a bourgeoisie, since to do so would be equivalent to questioning the capitalist society in which drug use developed and therefore to finally to indict that society, which, above all, must not be done!

Such a “liberal-libertarian” bourgeoisie is nothing but one more component of the prevailing moral disorder. Its vast pretension to want to replace the old bourgeois moral order which is dying, is a pure and simple fraud. The way it calls all those who express doubts about the changes that it seeks to make “antiquated” and “old fashioned reactionaries”, forms part of the very pinnacle of ideological terrorism.

As long as capitalism is not abolished, the old bourgeois moral order will not be replaced, but its death throes will only be prolonged a little while longer, although here and there it will attempt to carry out remediation operations. As for knowing what will replace it, the only thing we can know for sure is that it will have to take place by means of a revolution!